FTX Trading CEO resigns as his collapsing company files for bankruptcy

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The cryptocurrency agency FTX Trading, a significant digital asset trade, has filed for bankruptcy and its billionaire founder, Sam Bankman-Fried, has resigned as chief government officer, the company introduced on Friday.

“I’m really sorry, again, that we ended up here,” Bankman-Fried stated in a Tweet thread on Friday. “Hopefully things can find a way to recover.”

FTX Trading and affiliate FTX US, together with Bankman-Fried himself, have been under investigation by the Texas State Securities Board since early October over whether or not the company is providing unregistered securities to Texans by way of its yield-bearing cryptocurrency accounts. The company isn’t registered to promote securities in Texas however has stated that it believes it’s working legally as a result of there’s an “active application for a license which has been pending.”

The company’s collapse got here after Changpeng Zhao, the CEO of cryptocurrency rival Binance, questioned FTX’s viability and declined to purchase out the company in a bailout deal provided by Bankman-Fried. Investors raced to money out their deposits and the company couldn’t deal with the inflow of cash-outs, in keeping with a number of experiences.

The bankruptcy submitting in Delaware — which incorporates FTX Trading, FTX US, Alameda Research and about 130 further affiliated corporations collectively identified as the FTX Group — seeks to permit the group to “assess its situation and develop a process to maximize recoveries for stakeholders,” newly-appointed FTX Group CEO John J . Ray III stated in a press release.

A Bloomberg report on Friday stated Bankman-Fried’s belongings went “from $16 billion to zero in days” as a results of the “downfall of his crypto empire.” In March, the report stated, his belongings had reached $26 billion.

Bankman-Fried was a significant supporter of Texas gubernatorial candidate Beto O’Rourke and donated $1 million to the Democrat’s marketing campaign within the quarter earlier than Tuesday’s election. O’Rourke misplaced his race to unseat Republican Gov. Greg Abbott.

Several FTX subsidiaries — LedgerX LLC, FTX Digital Markets Ltd., FTX Australia Pty Ltd. and FTX Express Pay Ltd — will not be included within the bankruptcy proceedings.

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