Crypto Giant FTX Files For Bankruptcy, CEO Steps Down
Cryptocurrency exchange FTX will file for bankruptcy in the US and its chief executive, Sam Benkman-Fried, will step down following a liquidity crisis at the company that prompted intervention by regulators around the world.
According to the press release, the bankruptcy filing covers about 130 subsidiaries. Some others, such as FTX Australia and Express Pay, are not involved in bankruptcy proceedings. Filing for Chapter 11 bankruptcy doesn’t mean the company is deadlocked—it allows the business to continue trading while it develops a plan to repay its creditors.
The company quickly found itself in dire straits after the price of the native token plummeted and many users withdrew the cryptocurrency. Following reports that the company was facing a liquidity crunch, Changpeng Zhao, CEO of rival crypto giant Binance, said the company would sell for around $529 million. This almost destroyed the value of the token.
