FTX CEO Bankman-Fried Resigns, Bankruptcy Proceedings Begin

Bankruptcy includes 130 FTX-related entities

article-image

Blockworks exclusive art by Axel Rangel

share

In a notice posted to the FTX official Twitter account this morning, FTX announced that Sam Bankman-Fried would be stepping down from his position as CEO of the FTX Group.

Approximately 130 companies affiliated with Bankman-Fried’s FTX Group have also commenced voluntary bankruptcy proceedings, according to the note.

New CEO John J. Ray III said that FTX has “valuable assets that can only be effectively administered in an organized, joint process” and noted that the Chapter 11 proceedings do not include LedgerX LLC, FTX Digital Markets Ltd, FTX Australia Pty Ltd. and FTX Express Pay Ltd.

Ray previously held CEO, chief reorganization officer and other similar roles at various public and private companies, including Enron Corp., Fruit of the Loom and Nortel Networks.

The FTX bankruptcy follows rumors of a massive hole in the company’s balance sheet, with some estimates rising as high as $9 billion.

Over the past two weeks, Bankman-Fried’s $32 billion company collapsed in the face of mounting evidence that the relationship between FTX and Alameda Research, the trading arm he also co-founded, was deeply unhealthy. Regulatory and legal authorities are now looking into that relationship, and the allegation that FTX loaned customer funds to Alameda, which the latter used to make risky bets on crypto.

Binance backed away from its earlier plan to acquire FTX, tweeting Wednesday afternoon that it would not pursue buying the company. The rival exchange’s decision was “a result of corporate due diligence, as well as the latest news reports regarding mishandled customer funds and alleged US agency investigations,” according to a Binance statement. 

Bankman-Fried’s resignation comes after he apologized for FTX’s collapse in a Twitter thread Thursday. 

“I’m sorry. That’s the biggest thing,” he tweeted at the time. “I f**ked up and should have done better.”

Bankman-Fried added in the Twitter thread that the company was in talks with “a number of players” as it searched for liquidity.

FTX’s bankruptcy proceedings are not unique for the industry this year. Voyager Digital filed for bankruptcy in early July, while crypto lender Celsius initiated bankruptcy proceedings about a week later in the aftermath of the collapse of Terra’s algorithmic stablecoin.  

The owner and operator of FTX US scooped up Voyager Digital assets estimated to be worth more than $1.4 billion at an auction in September. But Voyager said in a statement Thursday that the transaction between FTX and Voyager “has not been consummated.” 

This is a developing story and may be updated.

Ben Strack contributed reporting.


Get the news in your inbox. Explore Blockworks newsletters:

  • Blockworks Daily: The newsletter that helps thousands of investors understand crypto and the markets, by Byron Gilliam.
  • Empire: Start your morning with the top news and analysis to inform your day in crypto.
  • Forward Guidance: Reporting and analysis on the growing intersection of crypto and macroeconomics, policy and finance.
  • 0xResearch: Alpha directly in your inbox. Market highlights, data, degen trade ideas, governance updates, token performance and more.
  • Lightspeed: Built for Solana investors, developers and community members. The latest from one of crypto’s hottest networks.
  • The Drop: For crypto collectors and traders, covering apps, games, memes and more.
  • Supply Shock: Tracking Bitcoin’s rise from internet plaything worth less than a penny to global phenomenon disrupting money as we know it.
Tags

Upcoming Events

Industry City | Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

Research Report Templates.jpg

Research

Bluefin possibly stands at an inflection point. The token is near an all-time low yet the protocol’s spot volume market share and derivatives exchange usage have been increasing month over month since its November launch. Given its current market position and the upcoming upgrades (for both Bluefin and SUI), there may be upside potential before the increased supply growth in December. However, strong opposition from existing competitors (like Cetus and Suilend), as well as new entrants (like Aftermath), pose key challenges to Bluefin’s medium-term success.

article-image

A memecoin short squeeze pushed Hyperliquid to the brink — and revealed decentralization limits

article-image

Tools for Humanity’s Developer Reward pilot program kicks off on April 1

article-image

Blockworks Research analyst Boccaccio explains the HyperLiquid controversy and why they need to adjust risk and margin

article-image

What Grayscale’s watching going into the second quarter and why crypto had a rough start to the year

article-image

Sol’s price drop was partially triggered by one of the year’s more chaotic memecoin events

article-image

Are digital assets just part of “normal” finance conversations now?