Here’s some background on the FTX mess, to begin with.
It all started earlier this month when Coindesk, a crypto news website, released a post claiming that substantial FTX funds had been diverted to Alameda Research, a company with close ties with FTX. Following this scandal, FTX platforms got hacked.
On Friday, the 11th of November, the company confirmed it in an announcement where they also declared bankruptcy, urging users not to log into FTX apps or websites.
Amidst the mishaps, Binance signified interest in acquiring FTX to salvage what was left of it but pulled out at the last minute, stating that the situation had gone beyond its ability to help.
Eventually, the CEO of FTX, Sam Bankman-Fried, apologetically stepped down. His position is now filled by John J. Ray III, a 63-year-old insolvency professional renowned for rescuing failed companies.
However, Ray III has openly stated that he’d never seen “such a complete failure of corporate controls and such a complete absence of trustworthy financial information.”
Also, in recent news, former CEO, Bankman-Fried, has apologized to his former employees, saying he’s deeply sorry for ‘what happened’ and what it meant for them. However, he had no comments about the allegations that FTX diverted corporate and customers to his Alameda Research or that Alameda loaned FTX officials some funds.
In addition, the 30-year-old believes he should not have filed for Class 11 bankruptcy and maintains there’s still a chance to save the company amidst the hope of new investors.
In his apology letter to his former employees, SBF said:
“Maybe there is still a chance to save the company. I believe that there are billions of dollars of genuine interest from new investors that could go to making customers whole. But I can’t promise you that anything will happen because it’s not my choice.”