After the cryptocurrency exchange FTX filed the largest bankruptcy case in the history of the currency circuit, it attended the first hearing on Tuesday (22nd). The lawyer representing FTX said that all FTX operations were “the private territory of former CEO Sam Bankman -Fried (SBF)”, a large amount of assets had either been stolen or disappeared without a trace. US Senator Warren (Elizabeth Warren) said the FTX incident was a wake-up call for Congress to repair the network of broken regulations.
The hearing was held at the Wilmington Bankruptcy Court in Delaware on Tuesday (22nd) and the live broadcast on YouTube and Zoom attracted around 1,500 people to watch.
After FTX declared bankruptcy, it has been led by new CEO John Ray. The new management appeared in court on Tuesday (22nd), and its legal counsel James Bromley detailed how FTX took the next step at SBF .
Bromley described the collapse of FTX as possibly one of the most sudden and difficult failures in the history of American companies, and even global companies.
A lawyer representing FTX now hopes to sell his still-running business, but since filing for bankruptcy, it has been hit by cyber attacks that have wiped out “significant” assets. FTX continues to maintain close communication with the US Department of Justice and the US Attorney’s Office Cybercrime Team in New York.
FTX said on Saturday it was conducting a strategic review of global assets and preparing to sell or reorganize some businesses.
Bromley also described that although FTX is an international company, it operates as a “private territory” of SBF. At one point the company spent 300 million US dollars to buy houses and holiday cabins for high-level executives.
Reuters earlier reported that FTX spent about $120 million in the Bahamas over the past two years, buying at least 19 properties for its parents and company executives.
Wray has accused SBF of collaborating with the Bahamas to “wreck” the US bankruptcy and move assets overseas. The well-known lawyer who once worked on the Anlong reorganization case lamented that he has never in his 40-year career seen such corporate governance and financial information without credibility.
Customers of cryptocurrency exchanges lack safety net protections like deposit insurance Most FTX remediation or some recent money cycle bankruptcy events fall on the bankruptcy courts, and these courts still to try to clarify and answer various questions of cryptocurrency victims. a question
Judge John Dorsey granted several of FTX’s proposals to help the company with its bankruptcy, including keeping the names of clients whose funds have been frozen confidential until his next hearing next month.
FTX recently announced preliminary information that it owed the 50 largest creditors approximately $3.1 billion, but declined to disclose the names of the creditors on the grounds that this move would destabilize the currency cycle, expose customers to the threat of hacker attacks, and that could come. poaching by rivals The goal.
In addition, the lawyer said that FTX had received letters from the Senate and the House of Representatives and that it needed to attend a congressional hearing in December.
Warren presents a letter calling for stronger regulation
The FTX bankruptcy has drawn the attention of both Republicans and Democrats. Warren, a Democrat, wrote a letter to the Wall Street Journal (WSJ). He described the FTX incident as a wake-up call. “The United States should strengthen enforcement of existing laws before the next currency disaster brings the economy down.”
Warren said in the letter that the US Securities and Exchange Commission (SEC) should take a tougher stance on cryptocurrencies and called on Congress to increase funding for the SEC, the Department of Justice, and the Department of the Treasury.