Though Chapter 11 lets companies continue operating while they work out a plan to repay creditors, the filing offered no hint of reorganization plans
More than 130 entities tied to FTX.com, FTX US and trading firm Alameda Research Ltd. were listed in filings at federal court in Delaware, with the Alameda petition listing assets and liabilities of at least $10 billion each. That easily makes it the biggest bankruptcy in the US this year, affecting investors and other counterparties around the world.
“It’s such an unfortunate, stunning and shocking moment for the industry,” Owen Lau, analyst at Oppenheimer & Co. said by phone. “There will be a lot of angry investors, angry customers and angry regulators around the world.” Crisis quickly befell FTX this month after prices for the exchange’s native crypto token, FTT, plummeted and users raced to withdraw their assets. Rival crypto exchange leader Changpeng “CZ” Zhao had earlier said he would sell some $529 million of coins due to “recent revelations that came to light,” appearing to allude to a CoinDesk report that raised questions about Alameda’s financial health.
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