FTX Saga: Recent Chapter 11 Filing Highlights Fraud

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After a series of recent events, FTX is being investigated more closely. One of them is that the exchange only has $659,000 worth of less liquid assets.

The public is growing more and more outraged with how the exchange’s funds were handled as more information about the condition of the crypto exchange comes to light. According to recent financial data, the holdings of FTX in fair-value assets were quite minor. A court filing also reveals several events that could significantly affect how the case develops.

Financial data reveals that the embattled crypto exchange only had fair-value assets of $659,000. Given the funding the exchange received, which came from some of the largest investment companies in the world, this is astounding. Sequoia, SoftBank, Temasek, Tiger Global, and the Ontario Teachers’ Pension Plan contributed about $1.8 billion to FTX.

Financial Mismanagement in FTX Worse Than Anything I’ve Seen: John Ray

According to the petition, Bahamian regulators illegally entered the exchange to take assets after FTX declared bankruptcy. The request, according to the exchange, might call into doubt the ability of Bahamian regulators to serve as liquidators. The financial mismanagement even prompted John Ray, the new CEO, to write the following in a filing:

“Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information.”

Additionally, according to the filing by the new CEO, FTX, FTX US, and Alameda do not have accounting divisions. Additionally, he said that he was unable to locate Island Bay Ventures’ funds, the organization that is in charge of FTX’s share of Anthony Scaramucci’s SkyBridge Capital.

 

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Azeez Mustapha

Azeez Mustapha is a trading professional, currency analyst, signals strategist, and funds manager with over ten years of experience within the financial field. As a blogger and finance author, he helps investors understand complex financial concepts, improve their investing skills, and learn how to manage their money.