FTX
Cryptocurrency exchange / From Wikipedia, the free encyclopedia
FTX Trading Ltd., commonly known as FTX (short for "Futures Exchange"),[5] is a bankrupt company that formerly operated a fraud-ridden cryptocurrency exchange and crypto hedge fund.[6][7] The exchange was founded in 2019 by Sam Bankman-Fried and Gary Wang. At its peak in July 2021, the company had over one million users and was the third-largest cryptocurrency exchange by volume.[8][9] As of November 2022, FTX was the third-largest digital currency exchange boasting an active trading volume of USD 10 billion and a valuation of USD 32 billion.[10] FTX is incorporated in Antigua and Barbuda and headquartered in the Bahamas.[11] FTX is closely associated with FTX.US, a separate exchange available to US residents.[12]
Company type | Private |
---|---|
Industry | Cryptocurrency |
Founded | May 2019; 4 years ago (2019-05) |
Founders | Sam Bankman-Fried Gary Wang[1] |
Fate | Filed for Chapter 11 bankruptcy in November 2022 |
Headquarters | , |
Key people | John J. Ray III (CEO)[2] |
Products | |
Revenue | US$1.02 billion (2021)[3] |
US$272 million (2021)[3] | |
US$388 million (2021)[3] | |
Number of employees | c. 300 (2022)[4] |
Since November 11, 2022, FTX has been in Chapter 11 bankruptcy proceedings in the US court system.[13][14][15][16] Public concern began with rumors of unethical and fraudulent inter-company transfers of client funds. In November 2022 CoinDesk also raised concerns stating that FTX's partner firm Alameda Research held a significant portion of its assets in FTX's native token (FTT).[17][18] Following this revelation, rival exchange Binance's CEO Changpeng Zhao announced that Binance would sell its holdings of the token, which was quickly followed by a spike in customer withdrawals from FTX.[19] FTX was unable to meet the demand for customer withdrawals.[20] Binance signed a letter of intent to acquire the firm, with due diligence to follow, to ensure that customers could recover their assets from FTX in a timely manner, but Binance withdrew its offer the next day, citing reports of mishandled customer funds and U.S. agency investigations.[21] On December 12, 2022, founder Sam Bankman-Fried was arrested by the Bahamian authorities for financial offences, at the request of the US government.[22]
The current CEO of FTX is John J. Ray III, who specializes in recovering funds from failed corporations. Ray stated: "this situation is unprecedented." and "Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here."