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FTX Group Bankruptcy Filing Shows $1.24 Billion In Cash

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FTX Group Bankruptcy Filing Shows $1.24 Billion In Cash

(CTN NEWS) – FTX has a total cash balance of $1.24 billion, a court filing by advisers to the stricken crypto exchange’s restructuring revealed ahead of bankruptcy hearings scheduled later in the day.

An estimated 1 million creditors are now facing damages totalling billions of dollars due to the collapse of FTX, long one of the biggest cryptocurrency exchanges in the world.

In a Monday filing, Edgar Mosley of Alvarez & Marshal, a consulting firm assisting FTX, stated that the company’s cash balance as of Sunday was “significantly higher” than believed.

https://twitter.com/olmeg100/status/1595038146944987137

It includes almost $400 million at Alameda Research accounts, the cryptocurrency trading business controlled by Sam Bankman-Fried, the creator of FTX, and $172 million at FTX’s Japan division.

FTX has stated that it owes its 50 largest creditors over $3.1 billion, has started a strategic examination of its global assets, and is getting ready to sell some firms or reorganize others.

According to Reuters, Bankman-Fried utilised $10 billion in customer cash in secret to support his trading company, and at least $1 billion of those deposits had disappeared.

Before FTX’s so-called first-day motions were to be heard in Delaware, the specifics of its cash levels were revealed.

FTX has requested Judge John Dorsey to approve the first stages in its bankruptcy, such as paying staff and essential vendors, so that it can carry on business while Chapter 11 bankruptcy procedures are underway.

FTX Group Bankruptcy Filing Shows $1.24 Billion In Cash

In addition, the company had asked Dorsey to take over a different Chapter 15 action that liquidators appointed by a Bahamas court had filed in New York last week on behalf of FTX’s Bahamas unit.

These procedures are utilised by overseas businesses to request the support of American courts in international bankruptcy cases.

Lawyers for the Bahamian liquidators, who have in the past contested the legitimacy of the U.S. Before the hearing on Tuesday, the team overseeing the Chapter 11 procedures, with whom there had been disagreements about which case should take precedence, acceded to that demand.

FTX, which new CEO John Ray has run since the bankruptcy filing, has charged Bankman-Fried with collaborating with Bahamian regulators to “undermine” the U.S. bankruptcy case and transfer assets abroad.

Requests for comment from Bankman-Fried, FTX, and the Bahamas liquidators were not immediately fulfilled.

CONTAGIOUS FEARS

The collapse of FTX has rocked the crypto community, sending bitcoin to its lowest point in about two years and igniting concerns about a ripple effect among other businesses already struggling with the fallout from this year’s crypto market crash.

Days after being forced to halt customer redemptions due to the failure of FTX, major U.S. cryptocurrency lender Genesis declared on Monday that it was attempting to avoid bankruptcy.

A Genesis representative stated in an email to Reuters that the company aims to address the current issue amicably without filing for bankruptcy. The spokesman added that the company is still in contact with its creditors.

According to a Bloomberg News article that cited sources, Genesis was having trouble finding new money for its loan division and had warned investors that if they did not succeed, it might have to declare bankruptcy.

According to sources cited by The Wall Street Journal, Genesis approached Binance about investing, but the cryptocurrency exchange declined out of concern for a potential conflict of interest.

According to the WSJ, Genesis also requested cash assistance from Apollo Global Management (APO.N), a private equity firm.

In contrast to Binance, Apollo declined to comment when Reuters asked them for a response about the WSJ report.

Last Monday, Genesis Global Capital stopped allowing customers to redeem their loans, citing FTX’s unexpected failure.

Gemini, a cryptocurrency exchange that collaborates with Genesis to operate a crypto loan product, tweeted on Monday that it was still working with Genesis to make it possible for its users to withdraw money from the latter’s yield-generating “Earn” programme.

Last week, Gemini stated on its blog that the suspension of Genesis withdrawals did not affect any of its other goods or services.

Since the collapse of FTX, some cryptocurrency players have turned to “DEXs,” or decentralised exchanges, where investors trade among themselves on the blockchain.

According to market tracker DeFi Llama data, on November 10, as FTX crashed, overall daily trading volumes on DEXs soared to their greatest level since May, but have subsequently reduced gains.

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Alishba Waris is an independent journalist working for CTN News. She brings a wealth of experience and a keen eye for detail to her reporting. With a knack for uncovering the truth, Waris isn't afraid to ask tough questions and hold those in power accountable. Her writing is clear, concise, and cuts through the noise, delivering the facts readers need to stay informed. Waris's dedication to ethical journalism shines through in her hard-hitting yet fair coverage of important issues.

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