FTX bankruptcy: $1 billion to recover for $9 billion in debt to pay off

In search of the lost billions – November 11, 2022, Sam Bankman-Fried (SBF) launched the bankruptcy proceedings for FTX and its sister company Alameda Research. He then resigned from his position as CEO of FTX. John Ray, former manager of the bankruptcy of Enron, then tackled the unprecedented site of the bankruptcy of FTX, becoming the new boss of the fallen platform. Since then, these are $9 billion in debt and more1 million creditors which have been revealed. The hour of the accounts begins to point the tip of its nose for the liquidators.

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In search of more than 1 billion dollars

The various hearings of the liquidators of FTX, as well as the many testimonies and documents revealed by the media, have made it possible to gradually lift the veil on a disaster management accounts from FTX and Alameda Research. These investigations revealed 9 billion dollars of debt, of which more than 3 billion to its 50 largest creditors.

Accused – among other things – of fraud, Sam Bankman-Fried would have left behind obscure account books and a equally dark account held in Korea. Faced with this slump, the new leaders of FTX are trying to recover what remains of the SBF empire from various bank accounts. From this diaspora, the liquidators thus confirm having located the following sums:

  • $720 million assets held by US financial institutions;
  • $500 million always in American institutions;
  • $130 million would be blocked in Japan;
  • 6 million retained for operational expenses;
  • $423 million at an American broker whose name is kept secret.

Alone $485 million are currently in a depository institution authorized by the new management of FTX.

FTX must pay off $9 billion in debt, including $1 billion in cash
FTX must pay off colossal debts

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Statements from FTX’s new CFO

Mary Cilia, new CFO (Chief Financial Officer) at FTX gave several affidavits during depositions regarding FTX’s bankruptcy. She explains thus carry out investigations to find and collect funds from FTX:

“We are contacting all these banks and changing the signatories on the accounts so that we can have access to the accounts and transfer the money as much as possible to authorized depository institutions”

In addition, our colleagues from CoinDesk relate also the words of Steve Coverick, Senior Director and Financial Advisor to FTX. The latter confirms that efforts are underway to repatriate the funds into a cold wallet from providers, such as Bitgo.

The slump seems such that the company – contrary to what the bankruptcy law requires – will not be able to provide a balance sheet of its financial situation before the month ofApril 2023. The calamitous management of FTX funds worries, as bankruptcy managers try to find funds to reimburse the victims of the crypto platform. Expected Friday for new hearings regarding his extradition to the United States, 8 counts are currently focused on Sam Bankman-Fried.

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