New Development: Sam Bankman-Fried is Attempting to Raise New Capital to Fix FTX Problem
By Published On: November 16, 2022Categories: Uncategorized0 Comments

Sam Bankman-Fried. Source: a video screenshot, HBO / YouTubeFounder and former CEO of FTX Sam Bankman-Fried is striving to raise fresh capital in a bid to make customers whole despite bankruptcy filings. In a recent Twitter thread, he is “meeting in person” with both potential investors and regulators to do what they can for customers. “And after that, investors. But first, customers,” he said. He also provided some context around the sudden fall of FTX and how the crypto exchange went from being one of the most powerful players in the industry to having a $9 billion hole in its balance sheet. “A few weeks ago, FTX was handling ~$10b/day of volume and billions of transfers. But there was too much leverage–more than I realized. A run on the bank and market crash exhausted liquidity. So what can I try to do? Raise liquidity, make customers whole, and restart,” he said. SBF added that the company currently has less than $8 billion in liquid assets, more than $5.5 billion in semiliquid assets, and another $3.5 billion in illiquid assets. So he is trying to raise $9 billion to cover the company’s $9 billion worth of semiliquid and illiquid assets for now. In a separate report, the Wall Street Journal confirmed that SBF had been desperately going from one investor to another in an attempt to raise funds. The report claimed that the efforts to cover that shortfall have so far been unsuccessful.Speculations around the health of FTX and Alameda increased last week after reports revealed that the investment firm’s balance sheet is loaded with FTT tokens, the native token of FTX, which has tumbled by more than 90% over the past week.By the end of the week, FTX announced that it had filed for Chapter 11 bankruptcy in Delaware. Notably, FTX US was also included in the proceedings, despite claims by the former CEO that their US exchange was fine.Companies under bankruptcy protection sometimes receive loans meant to help maintain operations. Debtor-in-possession financing means that if companies survive, the first funds they earn will go toward paying down that lifeline, the WSJ said. As reported, FTX lent as much as $10 billion worth of customer assets to fund risky bets by its affiliated trading firm, Alameda Research. Since FTX had $16 billion in customer assets, the exchange had lent more than half of its customer funds. The recent drama around FTX has set the stage for one of the worst crypto price crashes over the past year. The flagship cryptocurrency has been trading around the $16,000 mark for the past week, a level not seen in two years. The broader crypto market is also down by at least 20% over the past 10 days.  Sam Bankman-Fried FTX FTX Token Recommended Blockchain News Nov 13, 2022 Crypto.com Sends $400 Million Worth of Ethereum to Wrong Address, Binance CEO Warns Users to Stay Away Source

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