FTX, the exchange founded by disgraced entrepreneur Sam Bankman-Fried, and Alameda Research have transferred another substantial sum of cryptocurrency as part of a larger $551 million asset management effort.
According to the blockchain analytics platform, Lookonchain, the diverse mix of transferred cryptocurrencies — about $22 million worth — included Ethereum (ETH), Uniswap (UNI), Shiba Inu (SHIB), and several others. The move follows prior transfers of substantial amounts to well-known exchanges.
These crypto asset transfers are part of FTX’s ongoing bankruptcy proceedings and endeavors to optimize the value of its token and address the financial strain faced by it and Alameda Research.
The firms recently executed asset transfers worth $10.8 million across platforms like Wintermute, Binance, and Coinbase.
The latest transfers were distributed among eight tokens, including $2.58 million in StepN (GMT), $2.41 million in Uniswap (UNI), $2.25 million in Synapse (SYN), $1.64 million in Klaytn (KLAY), $1.18 million in Fantom (FTM), $644,000 in Shiba Inu (SHIB), along with smaller amounts of Arbitrum (ARB) and Optimism (OP).
Last month, reports emerged that the team transferred about $24 million worth of crypto through Kraken and OKX exchanges. Empowered by a U.S. court-approved plan, they are now authorized to sell digital assets, initially up to $100 million, with a potential increase to $200 million, subject to a special committee approval.
The financial arrangement to liquidate assets and possibly reimburse creditors commenced its initial phase in March 2023, with the team coordinating the transfer of $145 million in stablecoins across several centralized exchanges.
Despite recovering assets exceeding $5 billion, FTX faces a challenging situation, as its liabilities exceed $8.8 billion. Whether the users of the once-leading exchange will fully be reimbursed remains to be seen.
Bankruptcies, regulatory shifts, and investor challenges
The cryptocurrency sector has encountered numerous high-profile bankruptcies in recent years, highlighting the inherent risks and complexities within the industry, Mt. Gox, a Tokyo-based exchange, notably declared bankruptcy in 2014 after a significant hack, having managed over 70% of global Bitcoin transactions at its peak.
In 2020, the abrupt closures of two major exchanges, FCoin and Cryptopia, left investors bewildered without any explanation for the shutdown.
2022 also witnessed a wave of high-profile bankruptcies in the crypto industry, involving heavyweights like Voyager, Celsius, and Three Arrows Capital (3AC). FTX entered bankruptcy due to a lack of proper financial controls and customer funds misappropriation.
While bad actors like Sam Bankman-Fried, the former FTX CEO may serve lengthy jail terms for their fraudulent practices, the fact remains that these crypto bankruptcies have gotten countless investors stranded and they may never be made whole.
In related news, Binance, the world’s largest crypto exchange, and its former CEO Changpeng Zhao recently reached an over $4 billion settlement with the U.S. Securities and Exchange Commission (SEC) over corrupt practices.
