- FTX Group’s bankruptcy filing exposed the defunct cryptocurrency business and several affiliates had a total cash balance of $1.24 billion.
- The majority, $751 million, is held in the debtor business. The remaining $488 million is held in non-debtor entities.
- Of all the subsidiaries, Alameda Research owns the largest stock, at $393 million.
Based on bankruptcy filings, it appears that insolvent cryptocurrency exchange FTX and its affiliates had a total of $1.24 billion in cash as of November 20. That number is far less than what the company owes to the 50 largest cities.
FTX’s proposed financial advisor, Alvarez & Marsal North America, disclosed in a document filed Monday that about $751 million is held in debtor entities. The remaining $488 million is held in non-debtor entities. There are approximately $514 million in liquid assets (cash and cash equivalents), and $260 million in custody. An additional $465 million is in restricted funds. This restricted money can only be used for things like paying off loans.
Earlier this month, SBF’s cryptocurrency empire collapsed into disorderly bankruptcy leaving more than 1 million creditors behind. These events greatly shook the entire sector. A crypto billionaire went from industry hero to villain in the space of a week. He lost the bulk of his fortune as his $32 billion company went bankrupt, drawing scrutiny from the Securities and Exchange Commission and the Department of Justice. Today, more information about the group’s financial condition became available, according to a report from Bloomberg Law on Tuesday.
Distribution of FTX Group cash reserves
On November 11, the exchange frantically filed for Chapter 11 bankruptcy in the US courts. This misleadingly suggests that some FTX affiliates were also doing the same thing. FTX has more than 1 million creditors, and the 50 countries owe a total of $3.1 billion in debt, according to a separate court record.
With $393 million, Alameda Research has the most cash on hand of many entities. With $171 million, FTX Japan has the most cash on hand for the companies that fall under the FTX silo. The Japanese cryptocurrency exchange is said to be planning to start withdrawing again by the end of the year.
Another document revealed the complex organizational structure of the nearly 100 SBF subsidiaries, most of which hold majority stakes. According to the newspaper, FTX’s parent company was located in Antigua, not the Bahamas, which is listed as the location for the cryptocurrency exchange’s headquarters.
on the flip side
- John J. Ray III, the exchange’s new CEO and former overseer of financial disasters like Enron, also condemned the bankrupt exchange.
- Ray criticized senior management for incompetent record-keeping, lack of experience, and use of corporate cash to purchase real estate in the Bahamas.
Why should you bother
Institutional and individual investors of all kinds have fallen into disarray. It also hurt liquidity in digital asset markets and fueled fears of a domino effect.
Read more about the SBF’s collapsing crypto empire:
FTX holds more than $3 billion to 50 creditors, court filings show
Co-founder (ETH) Vitalik Buterin says there are lessons to be learned from the FTX crash