FTX files for bankruptcy

Exchange FTX has officially filed for bankruptcy, and the platform’s CEO, Sam Bankman-Fried, has also resigned from his position.. The exchange’s management was forced to this extreme after suffering severe liquidity problems.

A few hours ago the administration of FTX launched a press release officially declare bankruptcy. The main reason is the liquidity crisis the exchange acknowledged earlier this week, a crisis that required $4 billion to maintain operations and about $9 billion to close the deficit. This crisis has caused the exchange’s native asset, the ITF, to plummet, which is currently trading at about $2.67, down from $25.4 seven days ago.

According to the statement, FTX, Alameda Research and the group’s hundred or so subsidiaries will file for Chapter 11 bankruptcy protection.. In doing so, they will seek the highest possible return for the platform’s assets.

Platform CEO, Sam Bankman-Fried voluntarily resigned from his position, also under Chapter 11 of U.S. law.. Bankman-Fried also resigned from his position at Alameda Research and acknowledged that he had failed to manage the cryptocurrency trading platform. In the coming hours, Bankman-Fried is expected to draft a letter full of details about what happened, the current situation, and how he will proceed with FTX.

The main concern now is that the well-known contagion effect within the blockchain ecosystem does not occur. FTX was exposed to many other companies that could be affected by its failure, leading to problems in these other platforms.. Major related companies have already begun taking steps to avoid potential problems in the coming weeks. Binance, the leading cryptocurrency exchange by volume, announced the increase of the SAFU fund to $1 billion.

Continue reading as TRON acquires USDT 1 billion to “safeguard” the marketcould be interesting.