FTX Files for Bankruptcy in the US Amid Cryptocurrency Exchange Meltdown

FTX has entered bankruptcy proceedings in the United States and chief executive Sam Bankman-Fried said on Friday that he would be stepping down.

The announcement, made on the company’s Twitter handle, comes just days after bigger rival Binance scrambled away from a proposed acquisition and scrambled to raise about $9.4 billion from investors and rivals.

Bankman-Fried’s trading firm, Alameda Research, is also subject to bankruptcy protection, the company said. Sources say the company was partly behind FTX’s troubles and reportedly owed FTX about $10 billion.

FTX’s bankruptcy represents a stunning reversal of fortunes for the company and its founder, Sam Bankman Freed. Until recently, he was dubbed the “White Knight” and compared to billionaire Warren Buffett.

There are also questions about the future of small businesses like BlockFi, which signed rescue packages with FTX, and bankrupt cryptocurrency lender Voyager Digital, after May’s TerraUSD crash pushed many to the brink of collapse. is throwing

FTX was seeking a lifeline after liquidity was at stake as clients withdrew funds at a frenetic pace. It also fuels concerns about the future of the cryptocurrency industry, which faces the daunting task of regaining support among retail investors.

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