Cryptocurrency exchange FTX owes its 50 biggest creditors a whopping $3.1 billion, according to a Saturday bankruptcy court filing.
Approximately $1.45 billion is owed to FTX’s top 10 creditors, with nine figures owed to each of them. Their names are redacted from the documents.
Since filing for bankruptcy on Nov. 11, FTX and its affiliate companies revealed that it may have more than 1 million creditors worldwide.
New CEO John J. Ray III, a veteran business executive who’s acted as chief restructuring officer and CEO in some of the largest corporate failures in U.S. history — most notably Enron in 2001 — called FTX’s recent downfall from multi-billion-dollar enterprise to bankrupt “unprecedented” in a Nov. 17 court filing.
“Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here,” he noted of FTX’s operations under founder and then-CEO Sam Bankman-Fried.
Ray, who filings show is earning $1,300 an hour leading FTX through bankruptcy, said on November 17 that he does “not have confidence” in FTX’s balance sheet as produced under Bankman-Fried.
On Saturday, FTX announced the launch of a strategic review of global assets in preparation for a sale or reorganization of certain businesses.
"Based on our review over the past week, we are pleased to learn that many regulated or licensed subsidiaries of FTX, within and outside of the United States, have solvent balance sheets, responsible management and valuable franchises," Ray said in a prepared statement.
"Some of these subsidiaries – such as LedgerX LLC and Embed Clearing LLC, for example – are not debtors in the chapter 11 cases. Other subsidiaries – such as FTX Japan KK, Quoine Pte. Ltd, FTX Turkey Teknoloji Ve Ticaret A.Ş., FTX EU Ltd, FTX Exchange FZE and Zubr Exchange Ltd – are debtors. Either way, it will be a priority of ours in the coming weeks to explore sales, recapitalizations or other strategic transactions with respect to these subsidiaries, and others that we identify as our work continues," he said.
A first-day hearing is set for Tuesday in bankruptcy court.
In a separate filing, FTX asked the court for permission to pay up to $17.5 million to vendors. If the court denies the requested relief, it will result in “immediate and irreparable harm” to its businesses.
Meanwhile, despite Ray’s assertions that Bankman-Fried has had no place in FTX’s decision making process since he stepped down on Nov. 11, Bankman-Fried reportedly told CNBC Monday that he’s “trying to lock down a multibillion-dollar deal to bail out FTX.”
