Troubled Crypto Exchange FTX Files for Chapter 11 Bankruptcy Protection as CEO Steps Down – The troubled cryptocurrency exchange FTX has informed the public that its parent company, West Realm Shires Services, along with approximately 130 affiliated companies, have filed for Chapter 11 bankruptcy protection in Delaware.
FTX has announced on Twitter that it has filed for Chapter 11 bankruptcy in the United States, following days of confusion and speculation. The letter indicates that West Realm Shires Services, Alameda Research, and approximately 130 additional affiliated companies have initiated voluntary proceedings.
The former CEO of FTX, Sam Bankman-Fried (SBF), has resigned and been replaced by John J. Ray III. “The immediate relief of Chapter 11 is appropriate to provide the FTX Group the opportunity to assess its situation and develop a process to maximize recoveries for stakeholders,” the FTX statement said on Friday.
Troubled Crypto Exchange FTX Files for Chapter 11 Bankruptcy Protection as CEO Steps Down – The news follows three turbulent days in which the valuation of FTX steadily declined from $32 billion to zero. It also follows discussions with Binance, the world’s largest exchange, which initially stated that it would acquire FTX but later announced that it would back out of the deal following due diligence.
Certain FTX-related subsidiaries, including Ledgerx, FTX Digital Markets, FTX Australia, and FTX Express Pay, are excluded from the announcement. According to Anthony Scaramucci, founder of Skybridge Capital, he flew to the Bahamas to assist SBF, but saw that the problem was more than just a liquidity issue.
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