Bankrupt FTX company’ leaders are planning to sell some of the well-established businesses to remain away from more losses.
FTX was a popular crypto exchange and was standing at 2nd rank in the whole crypto space but mismanagement of user’s funds by the key members of this exchange resulted in a very big downfall of this company along with all of its subsidiaries. On 12 Nov the company filed for bankruptcy in a US district bankruptcy court under chapter 11.
At present, Johan Ray III is FTX CEO who is a restructuring expert. Under the leadership of the current FTX CEO, lawyers filed a motion in court to get regulatory approval to sell some of its well-established businesses like LedgerX, FTX Japan, and FTX Europe.
FTX Japan & FTX Europe are crypto exchanges in Japan & Europe respectively and LedgerX is a crypto assets derivatives platform. All these companies are still valuable & well-established in every aspect.
Lawyers claimed through the court filing that such businesses are running smoothly but there are significant risks because the core back-end company is FTX and its key officials may leave these well-established companies.
In short, FTX lawyers believe that the failure of core company FTX may also impact their existing well-established business, so it will be better for them to sell in early 2023.
FTX, Alameda Research & Bankruptcy
The main reason behind FTX exchange bankruptcy is Alameda Research. Alameda secured more than $1.2 Billion worth of funds from FTX without any disclosure and that was FTX user’s funds.
Under a critical situation, FTX failed to give funds withdrawal to all the users and finally, on 8 November FTX suspended its all services.
Many experts noted that FTX’s former CEO Sam Bankman-Fried (SBF) misused FTX users’ funds for his benefits like buying a flying jet, real estate property, expensive gifts to big celebrities, and political donations.
Read also: Most of the Gamers want to earn Bitcoin, not NFTs
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