“I have never seen a total failure like this.

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The new CEO of the controversial FTX exchange, John Ray III, called the bitcoin (BTC) and cryptocurrency exchange a “total failure” on Thursday, November 17. For Ray, many of the group’s related companies lacked proper corporate governance and were run by a very small and inexperienced group.

According to Ray, FTX has been engaged on several fronts including the company’s systems, supervision, and accountability for the use of funds.

“In my career I have never seen such a total failure of corporate controls and such a total absence of reliable financial reporting as in this case.” stated the executive in a document filed in the U.S. Bankruptcy Court for the District of Delaware.

“From the compromised integrity of the systems and poor offshore regulatory oversight, to the concentration of control in the hands of a very small group of inexperienced, inexperienced and potentially compromised individuals, this situation is unprecedented,” said Ray, who also served as head of fund management. led The bankruptcy of the US company Enron in 2001.

FTX users’ funds for home purchase.

Another aspect revealed by the new CEO is that FTX’s corporate funds are located in the Bahamas, where FTX is headquartered, would be used to purchase houses and other items staff For employees and consultants.

“It is my understanding that some of these transactions were not documented as loans and that some real estate was registered in the personal names of these employees and consultants in Bahamian records,” he pointed out.

The documents revealed that FTX’s creditors would find and secure “only a fraction” of the digital assets they hope to recover. The amount secured would be about $740 million in cryptocurrencies that would already be in cold wallets. However, it is estimated that the financial “gap” of FTX would be more than $8 billion.

The FTX case keeps the cryptocurrency ecosystem in the “eye of the storm.” Regulators around the world are with eyes on what happened to the exchange. As CryptoNews explains, the company used their self-issued token, FTT, as collateral to apply for the loans. When the price of the asset fellthe guarantee was liquidated and FTX went into financial crisis.