FTX Owes More Than $3 Billion To Its Senior Creditors, Reveals Lawsuits
Embattled cryptocurrency exchange FTX owes more than $3 billion (roughly Rs. 18,346 crore) to its top 50 creditors. A filing from its Chapter 11 bankruptcy protection proceedings on Saturday revealed the amount owed to unidentified creditors, with the largest being a little over $226 million (around Rs. 2,240 crore). According to the filing, the top 10 creditors come in at just under $1.45 billion (roughly Rs. 11,771 crore). In total, it added about $3.1 billion (roughly Rs. 25,166 crore).
Although the filing did not reveal the names of the parties folded in FTX’s quick demise, the document makes clear the scope of the losses its clients could face.
FTX’s top ten creditors alone have more than $100 million (about Rs. 812 crore) each in unsecured claims, according to the filing, which equates to more than $1.45 billion (about Rs. 11,771 crore) collectively. The filing explained that the debt does not include anything owed to company insiders and could change as more information becomes available.
The company also stated in the proposal that its debt figures may not be completely accurate because there may be payments that have already been made to creditors, but that do not appear on the company’s books or records.
In the US, bankrupt companies are required to disclose information about their debts as part of bankruptcy proceedings. Creditors will be able to call on FTX to pay its debts as bankruptcy occurs.
FTX said it has assets and liabilities of at least $10 billion (about Rs. 81,181 crore) each in original court papers. The lawsuit could involve more than a million creditors, according to FTX lawyers.
FTX was once the world’s third-largest exchange with a market capitalization of around $32 billion (roughly Rs. 2,59,780 crore) before a liquidity crisis brought the company down earlier this month. Bankman-Fried announced on November 11 before he stepped down that FTX, his trading firm Alameda Research, and related companies would file for bankruptcy.
