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 Opkomst en ondergang van FTX infographic
Graphic shows the fall of FTX crypto exchange.
GN43485NL

BUSINESS

Opkomst en ondergang van FTX

By Duncan Mil

November 14, 2022 - Bahamas-based crypto exchange FTX – once one of the world’s largest exchanges – filed for bankruptcy on Friday after a rush of customer withdrawals of its native token FTT spurred a liquidity crisis.

The Financial Times has published an FTX balance sheet dated Thursday, November 10, which shows the distressed crypto trading platform had less than $900 million of assets it could quickly sell, despite having $9 billion of liabilities.

FTX struggled to raise billions to stave off collapse as traders rushed to withdraw $6 billion from the platform in 72 hours last week.

FTX, its affiliated crypto trading firm Alameda Research, and about 130 of its other companies have filed for voluntary Chapter 11 bankruptcy proceedings in Delaware, the company said in a statement on Twitter, leaving more than 100,000 creditors.

In its bankruptcy petition, FTX Trading said it has $10 billion to $50 billion in assets, $10 billion to $50 billion in liabilities,

The sudden collapse of FTX -- which Sam Bankman-Fried, 30, founded in 2019, along with his trading shop Alameda Research, has dealt a severe blow to the digital asset sector.

The total market value of all crypto tokens has dropped more than 70% from a record peak of just under $3 trillion set a year ago, according to the CoinGecko website. The current crypto value is $843 billion as assessed by CoinGecko -- less than one per cent of the world equities market.

U.S. Senator Elizabeth Warren, a Democrat who has previously criticized the crypto industry, tweeted that the implosion of FTX was a wake-up call for Congress and regulators to hold the industry and its executives accountable.

“Too much of the crypto industry is smoke and mirrors. It’s time for stronger rules and stronger enforcement to protect ordinary people,” she said.

Sources
PUBLISHED: 14/11/2022; STORY: Graphic News; PICTURES: Getty Images. Linkedin
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