impending liquidationThe assets of the FTX crypto exchange have already been frozen
The negative headlines about the ailing crypto exchange FTX do not end: the insolvency administrator could take over next.
The bad news about the ailing crypto exchange FTX is not over. The Bahamas’ securities regulator announced on Thursday that it has frozen the assets of FTX Digital Markets. Furthermore, the insolvency administrator could take over the settlement. The supervisory authority has already filed a corresponding court request. The imbalance of a major trading platform for digital currencies like Bitcoin has kept the crypto market on edge for several days. Many customers are worried about their money.
FTX Digital Markets is a Bahamas-based company from American entrepreneur Sam Bankman-Fried’s crypto empire and operates the struggling crypto exchange FTX.com. According to the securities regulator, the company is suspected of misappropriating customer funds. FTX.com ran into liquidity problems after enormous withdrawals. On Wednesday, it initially looked like the company would be taken over by rival Binance. But this plan failed. Without a huge cash injection, FTX.com now faces bankruptcy.
Users are getting more and more nervous
The crypto platform ran into payment difficulties on Sunday after doubts about capital reserves led to a flight of customers and the withdrawal of billions in funds. Meanwhile, FTX users in the US are also getting nervous. In fact, FTX’s international and US operations are separate. Bankman-Fried tried to calm the situation on Twitter on Thursday, claiming that FTX.US is “100 percent liquid.” At the same time, the platform announced that it may suspend trading for several days. US media also reported that employees in the US were trying to sell parts of the company in a sort of distress sale.
The situation is increasingly critical for customers and investors. Unless Bankman-Fried surprisingly finds a few billion dollars somewhere, at least FTX.com shouldn’t be a bailout. The 30-year-old crypto entrepreneur assured on Tuesday that all deposits are protected and will be paid out in full. He dismissed rumors about a lack of money as false. Bitcoin benefited from a general upturn in the financial market on Thursday, last trading just below $17,500. On Wednesday, FTX concerns pushed it to a two-year low below $16,000.