Crypto giant FTX collapses into bankruptcy

Embattled cryptocurrency exchange FTX has filed for bankruptcy in the US, seeking court protection as it looks for a way to return money to users.

Former boss Sam Bankman-Fried has also stepped down as chief executive, the company said.

• Nigeria offers concession on $1.3bn China-funded hydro power plant
• Bauchi gov threatens to dethrone monarchs aiding insecurity

It is a massive turn of fortunes for the 30-year-old, who had headed the world’s second largest crypto exchange.

In just over a week, his FTX empire has collapsed, shaking confidence in the already troubled crypto market.

“I’m really sorry, again, that we ended up here. Hopefully things can find a way to recover,” Mr Bankman-Fried, nicknamed the ‘King of Crypto’, wrote on Twitter on Friday.

“I was shocked to see things unravel the way they did.”

The BBC is not responsible for the content of external sites.View original tweet on Twitter

Prior to the meltdown, Mr Bankman-Fried had been one of the stars of the crypto scene, drawing comparisons to investment magnate Warren Buffett, with a net worth estimated at more than $15bn (£12.8bn) as recently as Monday.

But rumours earlier this week that FTX and other firms owned by Mr Bankman-Fried were on shaky financial ground prompted a mass of customers to try to withdraw funds from FTX, an exchange used to buy and sell digital tokens.

Facing a cash crunch, Mr Bankman-Fried tried to organize a bailout but that failed, leaving FTX scrambling to raise billions of dollars and many customers unable to access their money.

By filing for Chapter 11 bankruptcy, the company can continue operating, while restructuring its debts under court supervision.

FTX said the goal was to “begin an orderly process to review and monetize assets for the benefit of all global stakeholders”.

In the filing, FTX estimated that it had between $10bn and $50bn in assets and liabilities and more than 100,000 creditors.

The proceeding involves FTX as well as Alameda Research, a trading firm founded by Mr Bankman-Fried, and roughly 130 affiliates, according to the statement FTX shared on Twitter. [bbc.com]