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A lawyer for FTX Trading revealed Tuesday that a “substantial amount” of assets had been stolen from bankrupt cryptocurrency exchange accounts, reducing the chances of millions of users getting their money back.

The admission took place Tuesday during FTX’s first court appearance since the company declaration of bankruptcySuch hearings are usually held a few days after filing, but the hearing was postponed this time because of FTX’s sudden collapse and management keeping very little record.

“This company was run by individuals who were inexperienced, unsophisticated, and potentially personally compromised,” said FTX creditors hired to bankrupt the company. said James Bromley, partner at law firm Sullivan & Cromwell. “This is he one of the most sudden and difficult corporate collapses in American corporate history.”

FTX, short billion dollars, sought bankruptcy protection After the exchange experienced the crypto equivalent of a bank run. According to the company, he has more than 100,000 claims to date, and that number could exceed 1 million once the lawsuits are closed.


Crypto crisis unfolds after FTX files for bankruptcy

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FTX was once a darling of the crypto world, raising nearly $2 billion in venture capital in three years. The company went bankrupt in spectacular fashion this month. Chapter 11 declaring bankruptcy It is shocking the entire crypto industry.Former CEO Sam Bankman-Fried resigns from the company, currently under Investigation Possible securities violations in the United States and abroad.

Court documents filed earlier this month show detailed financial statements. Among them, it was revealed that FTX had his $1.3 billion in assets and that he owed $102 million to customers on the day the company filed for bankruptcy. FTX owe creditors at least $3.1 billionaccording to court documents.

After the collapse of FTX, hundreds of millions of dollars of cryptocurrency was moved from FTX accounts to other wallets. There have been some reports that some of these funds may have been seized by the Bahamas government, where FTX is headquartered, as part of its own investigation, but most of these cryptocurrencies are being sold in a variety of different I am moving through my wallet. It seems like the crypto equivalent of money laundering.

less likely to get the money back

some experts believe FTX users will not get their funds refunded Anytime soon — if at all.

“We understand the concern and anger and are working around the clock to bring order to chaos,” Bromley said.

FTX’s bankruptcy has generated a lot of interest, not just from cryptocurrency investors. The company has won major sports sponsors such as Formula One racing and Major League Baseball. FTX has the naming rights to Miami’s sports arenas, and several celebrities have invested in his FTX or signed sponsorship deals with the company.

The FTX case is the third cryptocurrency company to seek bankruptcy protection this year, after Voyager Digital and Celsius Network.

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Written by Natalia Chi

Chicago Popular; Chicago breaking news, weather and live video. Covering local politics, health, traffic and sports for Chicago, the suburbs and northwest Indiana.

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