FTX bankruptcy filing speculates over 1M creditors

2 weeks, 6 days ago - November 15, 2022
FTX bankruptcy filing speculates over 1M creditors
Exchanges delist FTX Token pairs from trading platforms

FTX bankruptcy filing speculates over 1M creditors

In the latest bankruptcy filing for the exchange, it was revealed that there may be 1 million creditors, rather than the 100,000 initially estimated.

The FTX liquidation crisis turned bankruptcy saga continues as a recent filing reveals additional information on Sam Bankman-Fried’s leadership and the exchange’s final days.

On Nov. 14, a new document was filed in a United States federal court in Delaware, where FTX US is based. It revealed that the exchange may have “more than 1 million creditors in these Chapter 11 Cases.”

This comes after Bankman-Fried’s voluntary Chapter 11 bankruptcy filing on Nov. 11, which initially set forth 100,000 creditors. These speculated 1 million creditors are said to belong to more than 100 different companies.

The document also highlights Bankman-Fried’s resignation on Nov. 11 and reiterates that the company is now operating with restructuring executive John Jay Ray III as its CEO.

FTX’s new leadership petitioned to consolidate its claims into a single list consisting of 50 individuals and organizations due to overlap and the number of creditors involved.

“The debtors anticipate overlap among the various debtors’ creditor lists, and certain debtors may have fewer than 20 significant unsecured creditors.”

The company also asked permission from the courts to file electronically by email rather than post.

The latest document also touched on Bankman-Fried’s final days as CEO of the exchange. It said in the lead-up to the events of Nov. 11, “Questions arose about Mr. Bankman-Fried’s leadership and the handling of FTX’s complex array of assets and businesses under his direction.”

As events surrounding FTX unraveled, rumors began to surface regarding the former CEO’s status and whereabouts. Currently, it is understood that he is under supervision in the Bahamas and potentially looking to flee to Dubai.

The filing also highlighted the interest of global regulators, as FTX was one of the world’s largest exchanges.

“There is substantial interest in these events among regulatory authorities around the world.”

Following the industry-rattling events, many regulators spoke out in need of tighter, more defined crypto regulations.

Maxine Waters, the chair of the U.S. House of Representatives Financial Services Committee, warned of “major consequences” for those using unregulated crypto companies.

Regulators in California and New York City also said they would be looking into the collapse of the exchange. Outside of the U.S., federal entities in both the Bahamas and Turkey are investigating the situation.

Exchanges delist FTX Token pairs from trading platforms

Binance, BitMEX and KuCoin have delisted FTX Token pairs from their crypto exchange platforms.

As the FTX collapse continues to cause turmoil in the crypto industry, various crypto exchanges have delisted FTX Token FTT on their platforms.

In an announcement, crypto exchange Binance highlighted that it had removed the FTT/BTC, FTT/BNB, FTT/ETH and FTT/USDT trading pairs on its platform citing that the pairs failed to pass their recent reviews. However, the exchange noted that the FTT/BUSD pair is still available on its exchange.

*At #Binance we conduct regular reviews of listed assets to ensure they meet our standards to protect our users.

Based on our recent reviews, we will remove and cease trading of several $FTT trading pairs on 2022-11-15 04:30 (UTC):

FTT/BNB FTT/BTC FTT/ETH FTT/USDT

— Binance (@binance) November 14, 2022*

The decision follows requests from community members to delist the token. In a tweet, influencer Cevo urged Binance CEO Changpeng Zhao to immediately take action against FTT, suggesting delisting everything FTX-related to protect the exchanges’ customers.

Apart from Binance, BitMEX has delisted the perpetual swap contracts connected to FTT. This includes its FTT/USD and FTT/USDT pairs. The exchange cited a reduction in spot trading of the pairs as its reason for delisting. Like BitMEX, KuCoin has also delisted its FTT/USDT perpetual contract on KuCoin Futures.

Meanwhile, Zipmex has also announced that it would be delisting FTT on Nov. 22, 2022, but will leave withdrawals open until Feb. 14, 2023.

Days after the beginning of the FTX crisis, its former CEO, Sam Bankman-Fried, tweeted various cryptic messages, attracting wild theories and speculation within the crypto community. Some theorized that the tweets could be an act by Bankman-Fried to potentially make a defense by claiming insanity if he’s ever taken to court.

After the FTX fraud was brought to light, an interview with Bankman-Fried in The New York Times garnered criticisms from Crypto Twitter for seemingly defending the actions of the former FTX CEO. Many criticized the mainstream media outlet for attempting to change the narrative around his alleged financial crimes.

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