Dramatic Crypto Crash: FTX Hurricane Destroys All by Investing.com

Dramatic Crypto Crash: FTX Hurricane Destroys All by Investing.com
Dramatic Crypto Crash: FTX Hurricane Destroys All by Investing.com

Dramatic Crypto Crash: FTX Hurricane Destroys All by Investing.com


Investing.com – Cryptocurrency exchange FTX’s bankruptcy has spread to the NBA as the Miami Heat announced it will be changing the name of its FTX Arena

Well-known investor Kevin O’Leary, who runs a financial firm and a well-known television personality, called on FTX officials to enforce more guarantees and regulations in the industry.

“It’s time to set the rules,” O’Leary said. “Today we are at the bottom of the cryptocurrency market with the collapse of a major player. I’ve lost money, but I will continue to invest in this sector.”

US Securities Commission Comment

“We know what happened, but there appears to have been a lot of wrongdoing,” said Howard Fisher, attorney for the US Securities and Exchange Commission.

The attorney condemned the US Securities and Exchange Commission, noting that he expected clients would also go to court to get their investment back.

“I cannot comment on any possible investigation,” said Gary Gensler, President of the Securities and Exchange Commission. Since taking office, Gensler has called for more transparency in the crypto-asset sector.

“When you mix customer money with a lack of transparency, borrowing against that money and brokerage, investors pay the price,” Gary Gensler added.

The group is under investigation by the Securities Commission and the New York Department of Justice, the New York Times reported, citing sources familiar with the investigation.

The Securities and Exchange Commission, which generally does not comment on ongoing investigations, and the Justice Department have issued a statement.

rescue attempts

LFTX’s new head said that the cryptocurrency giant is “doing everything possible to ensure the security of all assets after unauthorized operations could result in hundreds of thousands of dollars being lost.”

“FTX-US and FTX.com continue to make every effort to secure all assets everywhere,” John Ray, the company’s new chairman, said in a tweet.

declaration of bankruptcy

John Ray added that there had been “unauthorized access to certain assets.” Ray took over as the company’s board after founder Sam Bankman-Fred resigned on Friday, the day the cryptocurrency exchange, the largely unregulated sector, closed its doors , announced that it had voluntarily positioned itself under the protections of Chapter 11 of the US Bankruptcy Code.

The company said on its account on Friday that “FTX Trading and about 130 affiliates of FTX Group have entered the voluntary process under Chapter 11 of the Bankruptcy Act to “evaluate their assets.”

This system allows any company to restructure its debt under court oversight while it continues to operate, and company officials did not mention the volume of transactions where unauthorized earnings were monitored, but hundreds of thousands of dollars may have gone missing.

663 million stolen

Cryptocurrency analytics firm Elliptic said in an analysis that just 24 hours after the bankruptcy declaration, more than 663 million FTX wallets were emptied.

In detail, “Eliptic” explained that “apparently $447 million was stolen, while FTX itself transferred the rest to a safe place for safekeeping.”

Just ten days ago, FTX was considered the second largest cryptocurrency platform in the world and its head, Sam Bankman-Fried, called SPF the best person to talk to for regulators around the world.

The group was valued at around $32 billion, but US media reported that the SPF’s fortune alone, which totaled around $16 billion, vanished in a matter of days.

No deals allowed

Counsel Ryan Miller spoke of an investigation into improper cases of portfolio movements related to the improvement of FTX balances between exchanges and pointed out facts that are not clear because other movements are not clear.

Miller confirmed that unauthorized transactions were observed, adding that the platform took precautions to move all digital assets to cold storage, where the process was expedited to mitigate damage while monitoring unauthorized transactions.

Binance Withdrawal

The issue began with the release of information in the media that the company’s fund, Alameda Research, invested in crypto assets issued by FTX.com in a risky financial transaction that could reveal a significant conflict of interest.

To add to the chaos at the company, the industry’s largest group, Binance, announced the sale of a cryptocurrency backed by FTX, then offered to buy the company on Tuesday and withdrew the offer the next day.

Fred Bankman’s announcement of his resignation hours after the platform declared bankruptcy in the recent rapid demise of a major player in the unregulated cryptocurrency sector has sent the cryptocurrency’s price plummeting.

The beginning of the collapse

According to the news, Sam Bankman-Frieds FTX Trading held $900 million in cash for $9 billion in liabilities the day before filing for bankruptcy on Friday.

Most of the assets captured were either illiquid venture capital investments or cryptocurrency tokens that are not widely used, according to the table.

The top assets were listed on Thursday at $2.2 billion in a cryptocurrency called Serum.

Global reports from a person involved in the negotiations showed that Benkman-Fried also wanted to sell $472 million worth of Robinhood Markets stock at a price of $9 per share as of Friday afternoon.

The filings also revealed that Bankman-Fried attempted to raise between $6 billion and $10 billion, including the issuance of convertible preferred stock, to later pay 10% to convert FTX International common stock, between $12 billion and $15 billion -Dollar.

Also, according to the chart, there is evidence of $5 billion in withdrawals last Sunday and $8 billion in passive income.

Benkmann-Fried told the Financial Times he has been linked to funds he “accidentally” gave to his trading company Alameda.

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