An announcement has just been made by FTX stating that the exchange is filing for chapter 11 bankruptcy.
- The company tweeted an official press release on November 12th stating that they “have commenced voluntary proceedings under Chapter 11 of the United States Bankruptcy Code in the District of Delaware in order to begin an orderly process to review and monetize assets for the benefit of all global stakeholders.”
- The subsidiaries that are not listed in the Chapter 11 proceedings include; LedgerX LLC, FTX Digital Markets Ltd., FTX Australia Pty Ltd., and FTX Express Pay Ltd. This means that FTX US is one of the 134 subsidiaries affected by the bankruptcy, alongside trading firm Alameda Research which owes FTX over $10B.
- It was only days ago where Sam Bankman-Fried had stated that “FTX is fine. Assets are fine,” in now-deleted tweets.
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- Filing for Chapter 11 bankruptcy means a reorganization of business affairs, debts, and assets – commonly known as a reorganization bankruptcy. This is the same bankruptcy that Celcius had filed for back in July.
- It was also made clear that Sam Bankman-Fried was stepping down as the CEO and taking his place is John J. Ray III. Although, SBF will be sticking around to “assist in an orderly transition.”
- “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 Group has valuable assets that can only be effectively administered in an organized, joint process,” said Ray.
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