Collapsing cryptocurrency exchange FTX under the rubble-sweeping John J. Ray is restarting and seeking US court permission for multimillion-dollar payments to critical suppliers. That way, the company may still be partially salvageable, Ray believes. However, this does not prevent an estimated 1 million other clients and investors from losing billions.
More than a week ago, it was announced that a major cryptocurrency exchange in the United States had applied for a payment delay. FTX and dozens of its affiliates have opted for so-called Chapter 11 bankruptcy proceedings. This procedure allows companies that are no longer solvent to continue operating while the organization prepares to sell or reorganize parts.
Founder Sam Bankman-Fried’s crypto empire is beginning to falter due to the depreciation of FTX’s own coin, FTT. The cryptocurrency exchange has been experiencing liquidity issues due to this decline. Then, rival cryptocurrency exchange Binance announced that it wanted to acquire FTX, but after due diligence decided not to. Lots of money from FTX clients would have disappeared without a trace.
Ray, who was named CEO to salvage what could be salvaged, says finances are still doing well at many of FTX’s subsidiaries. According to him, this is evident from the research conducted in recent days. The new president, a big name in eliminating American corporate bankruptcies, is asking all employees, customers and other stakeholders to be patient while he and his team try to set things right.