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Cryptocurrency exchange FTX Group files for Chapter 11 bankruptcy

Nov. 11 (UPI) -- Cryptocurrency exchange FTX Group -- with about 130 affiliated companies -- tweeted Friday that it has commenced voluntary Chapter 11 bankruptcy proceedings. The bankruptcy includes FTX Trading Ltd. doing business as FTX.com, West Realm Shires Services, Inc. and Alameda Research Ltd.

FTX Group said in a statement that CEO Sam Bankman-Fried has resigned, replaced by John J. Ray III. The company said Bankman-Fried and "many employees" of the FTX Group in various countries are expected to continue with the company to assist operations during the bankruptcy.

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"The immediate relief of Chapter 11 is appropriate to provide FTX Group the opportunity to assess its situation and develop a process to maximize recoveries for stakeholders," new FTX CEO Ray said in the tweeted statement.

The statement said there are approximately 130 affiliated companies in the FTX Group entering bankruptcy proceedings.

RELATED FTX reopens withdrawals, warns trading may be halted soon

But FTX Digital Markets Ltd., FTX Australia Pty Ltd., FTX Express Pay Ltd. and LedgerX LLC are not affected by the bankruptcy, according to the company statement.

The bankruptcy was filed in Delaware.

On Thursday, FTX reopened withdrawals after they had been stopped for two days. FTX said then that "trading may be halted on FTX U.S. in a few days." Earlier this year, FTX had been valued at $32 billion.

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"The FTX Group has valuable assets that can only be effectively administered in an organized, joint process," Ray tweeted. "I want to ensure every employee, every customer, creditor, contract party, stockholder, investor, governmental authority and other stakeholder that we are going to conduct this effort with diligence, thoroughness and transparency."

On Wednesday, Binance, the world's biggest crypto exchange, cancelled a tentative deal to acquire FTX. Binance said is had discovered mishandled customer funds and "alleged U.S. agency investigations."

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