What happened to FTX?

It all began in November 2022, when a CoinDesk report exposed Alameda Research (a quantitative trading firm run by Sam Bankman-Fried) for maintaining a $5 billion position in FTT, the native token of FTX. The article also brought up worries regarding the undisclosed leverage and solvency of Bankman-Fried's companies, which would quickly lead to the collapse of FTX.

Below is a timeline of the collapse that ensued, up until now, so that you’re kept up to date with what’s happening to FTX.

  • November 7, 2022 – As a result of the report, FTX encountered a liquidity crisis with clients demanding $6 billion in withdrawals in the days that ensued. While SBF attempted to get additional funding from venture capitalists, turning to Binance to buy FTX, they backed out of the deal the next day, following due diligence.
  • November 10, 2022 – The securities regulator in The Bahamas froze FTX's assets, which coincided with the California Department of Financial Protection and Innovation launching an investigation into the exchange.

    Bankman-Fried apologized for the liquidity crisis, admitting that FTX's non-U.S. exchange lacked sufficient funds to accommodate customer demands. He also announced that Alameda would wrap up trading.
  • November 11, 2022 –  SBF resigned as FTX's CEO and was replaced by John Ray, the court-appointed CEO. The exchange then filed for Chapter 11 bankruptcy protection, disclosing that about 130 companies were involved. The bankruptcy filings revealed that FTX had assets and liabilities of anywhere from $10 billion to $50 billion.
  • November 16, 2022 – FTX claimed to be victim of “unauthorized transactions” and transferred its digital assets to cold storage to keep them safe. A class-action lawsuit was filed in a Florida federal court, alleging that SBF had established a fraudulent crypto scheme aimed at exploiting unsophisticated investors.
  • November 18, 2022 – The Bahamas' Securities Commission (SCB) took custody of the crypto assets held by the bankrupt exchange to safeguard creditors.
  • December 12, 2022 – Authorities in the Bahamas arrested SBF and sent him to jail for several fraud charges related to FTX. He was subsequently deported to America and indicted on eight counts, including securities fraud and money laundering.
  • December 22, 2022 – Following a court hearing, a federal judge freed Bankman-Fried from custody after his attorneys and federal prosecutors reached a $250 million bond agreement, the most extensive in history.



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