US requests independent investigator for FTX collapse, crypt...| MENAFN.COM

Tuesday, 31 January 2023 03:57 GMT

US requests independent investigator for FTX collapse, crypto breakdown


(MENAFN) The US Justice Department has requests an independent investigator to restudy the bankruptcy of main cryptocurrency trading platform FTX, which also initiated a latest collapse in the crypto market.

US bankruptcy trustee Andrew R. Vara informed the Delaware federal bankruptcy court in a filing that an instant investigation is required to inspect the events and the firm’s structure that initiated FTX to collapse nearly a month ago.

"Over the course of eight days in November, beginning with reports of significant problems with one debtor’s (Alameda Research) balance sheet, the Debtors suffered a virtually unprecedented decline in value – from a market high of $32 billion just earlier this year – and a severe liquidity crisis after a proverbial 'run on the bank' amid revelations of multiple corporate failures and misuse of customer funds facilitated by 'software to conceal' it," Vara published in the filing issued on Thursday.

Vara named FTX's collapse "likely the fastest big corporate failure in American history," and stated that "Debtors' approximately one million worldwide creditors, outside investors, and regulators are demanding answers to what happened and how."

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