Daily Mail

One million investors could lose money from FTX crypto collapse

- By Mark Shapland

MORE than 1m investors could lose money after FTX collapsed.

Just over a week ago, the failed cryptocurr­ency exchange – founded by Sam Bankman-Fried – was valued at £27bn.

But it quickly imploded after experienci­ng a surge in withdrawal­s it was unable to fulfil.

In a court filing as part of its Chapter 11 bankruptcy, lawyers for FTX said: ‘There are over 100,000 creditors in these Chapter 11 cases. In fact, there could be more than 1m creditors.’

The abnormally large amount of creditors is a result of FTX’s sprawling and complex structure. The company was made up of a web of companies with more than 130 registered entities and grew quickly to become the world’s second largest digital coin exchange.

Most of the creditors were clients of 30-year-old BankmanFri­ed’s companies. The filing also reveals just how seriously law enforcemen­t agencies are taking the collapse.

Dozens of authoritie­s are circling the company – including the US Attorney’s Office, the

Securities and Exchange Commission and the Commodity Futures Trading Commission.

Bankman-Fried agreed to step down as chief executive last week. Restructur­ing specialist John Ray, known for his work on Enron, has taken over the company.

The court filing added: ‘Barely more than a week ago, FTX was regarded as one of the most respected and innovative companies in the crypto industry.’

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