FTX to start US bankruptcy proceedings, CEO Sam Bankman-Fried to exit

business-standard.com:

Beleaguered cryptocurrency platform FTX filed for bankruptcy protection Friday—a swift demise for a company hailed as a trusted platform just a week ago.

In a statement, the company said Chief Executive Sam Bankman-Fried resigned from his position but would remain at the company to assist with an orderly transition. FTX said that it would begin a process to review and monetise assets for stakeholders.

John J. Ray III has been named the new CEO of FTX Group, the company said. The bankruptcy filing includes FTX Trading, the company presiding over the global trading website FTX.com, Alameda Research, a trading firm founded by Bankman-Fried, and the company over FTX US, the platform for US users.

The company said in a statement on Friday, shared via a tweet, that FTX and its affiliated crypto trading fund Alameda Research and approximately 130 other companies have commenced voluntary Chapter 11 bankruptcy proceedings in Delaware.

The week-long saga that began with a run on FTX and an abandoned takeover deal by rival Binance has hit an already struggling bitcoin and other tokens.

FTX was scrambling to raise about $9.4 billion from investors and rivals, Reuters reported citing sources, as the exchange sought to save itself after customer withdrawals. The predicament marks a rapid reversal for Bankman-Fried, the 30-year-old crypto executive, whose wealth was estimated by Forbes at around $17 billion just two months ago.

Reports emerged that FTX lent billions of dollars worth of customer assets to fund risky bets by its affiliated trading firm, Alameda Research, setting the stage for the exchange’s implosion, a person familiar with the matter said.

Sam Bankman-Fried said in investor meetings this week that Alameda owes FTX