FTX announced that it went bankrupt. Cryptocurrency exchange FTX was among the most reliable exchanges along with Binance. With this development, trust in cryptocurrencies further decreased, while Bitcoin experienced a 6 percent decline. The CEO of the company, Sam Bankman-Fried, resigned and left the company.
Cryptocurrency platform FTX has filed for bankruptcy in the US. In the statement, which included the information that Sam Bankman-Fried, the CEO of FTX, resigned, it was noted that John J. Ray was appointed instead. Due to the liquidity problem, FTX did not allow its users to withdraw their money. $5 billion was withdrawn from FTX on Sunday; This is stated to be the largest amount in the stock market by far.
FTX started to experience liquidity problems after problems with its rival and the world's largest crypto exchange Binance. In order to solve his company's liquidity problem, Bankman-Fried started negotiations with Binance's Founder and Chief Executive Officer Changpeng Zhao on November 8, and the parties signed a letter of intent for Binance to purchase FTX. Binance announced that it stopped buying FTX shortly after the negotiations started.
WHY DID FTX FAIL?
Incoming information reports that the FTX exchange transferred approximately $10 billion of investor-owned assets to the Alameda Research initiative and made risky trades. This aroused suspicions about the stock market. In addition, borrowing billions of dollars by using non-existent assets as collateral brought its end.
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