The first-day motions hearing for FTX’s Chapter 11 case is underway in Delaware bankruptcy court. A “substantial amount” of FTX Group’s assets “have either been stolen or are missing,” an attorney representing the firm told the court Tuesday.
(Bloomberg) — The first-day motions hearing for FTX’s Chapter 11 case is underway in Delaware bankruptcy court. A “substantial amount” of FTX Group’s assets “have either been stolen or are missing,” an attorney representing the firm told the court Tuesday.
The collapse of Sam Bankman-Fried’s crypto empire has been swift and chaotic, leaving a group of bankruptcy experts to sift through the rubble. This hearing marks a key moment in the public reckoning.
Bloomberg Intelligence analysts expect the court appearance to address FTX’s pursuit of limited administrative relief and questions over where and how its assets will be managed. You can follow Bloomberg’s TOPLive coverage here.
A bankruptcy filing showed that the fallen cryptocurrency firm and a number of affiliates had a combined cash balance of $1.24 billion — more than debtors had identified a few days ago.
Investors are piling into bearish cryptocurrency bets, wagering that the collapse of Bankman-Fried’s crypto empire will further ravage the asset class. And the former co-head of Alameda Research, Sam Trabucco, used poker and black-jack strategies to trade, according to his tweeting history.
Key stories and developments:
- Crypto Diehards Brace for Family ‘I Told You So’ at Thanksgiving
- FTX Collapse Ensnares Creditors Big and Small All Over the World
- Alameda Former Co-CEO Used Poker, Blackjack Strategies to Trade
- Fallen Hedge Fund 3AC’s Founder Says FTX Set Crypto Back Years
- Crypto Firm Genesis Said to Warn of Bankruptcy Without New Funds
(Time references are New York unless otherwise stated.)
‘Substantial’ FTX Assets Are Stolen or Missing, Attorney Says (12:00 p.m.)
A “substantial amount” of FTX Group’s assets “have either been stolen or are missing,” an attorney representing the firm told a bankruptcy court Tuesday.
“Unfortunately, the FTX debtors were not particularly well run, and that is an understatement,” James Bromley, co-head of the restructuring practice at law firm Sullivan & Cromwell, told a judge in Wilmington, Delaware.
Binance CEO Zhao Seeks Middle East Cash for Crypto Recovery Fund (9:50 a.m.)
Binance Chief Executive Officer Changpeng “CZ” Zhao and several deputies met with investors in Abu Dhabi last week in an effort to raise cash for a crypto industry recovery fund, according to people familiar with the matter.
Zhao and his team held meetings with potential backers last week, including with entities affiliated with United Arab Emirates National Security Adviser Sheikh Tahnoon Bin Zayed, who oversees a large financial empire, said the people, who spoke on the condition of anonymity because the talks were private.
Alameda Former Co-CEO Used Poker, Blackjack Strategies to Trade (8 a.m.)
The former co-head of Alameda Research made it clear that poker and black-jack tables were where he honed the gambler’s instincts he applied to cryptocurrency trading.
“I may or may not be banned from 3 casinos for this,” Sam Trabucco once tweeted about counting cards at black-jack tables. Trabucco, who hasn’t publicly been accused of any wrongdoing, abruptly stepped down as co-chief executive officer in August, leaving Caroline Ellison as Alameda’s sole CEO.
Apollo Said Unlikely to Participate in Genesis Fundraising (7:12 a.m.)
Genesis has reached out to Apollo Global Management in a bid to secure an investment, but Apollo is unlikely to commit to a deal, according to a person with direct knowledge of the matter. One option proposed by Genesis was for Apollo to buy parts of its loan book, this person said.
Investors Rush Into Short-Crypto Funds in Bet FTX Hit to Worsen (6:43 a.m.)
Short-Ether and Bitcoin exchange-traded products dominated inflows into crypto ETPs in the past week, data compiled by Bloomberg show. At the same time, digital-asset ETPs’ total assets dropped to just under $22 billion, a two-year low.
The flows indicate investors see no end in sight to the havoc brought on by the bankruptcy of Bankman-Fried’s FTX Group, which is already tearing through the sector.
Crypto Lender Sued for Blocking Withdrawals by Wealthy Investors (5:55 a.m.)
Cryptoasset lender Nexo Capital was sued in London by investors who allege they were blocked from withdrawing parts of their $126 million in assets from the exchange in March 2021, when one Bitcoin was worth more than $54,000.
Fallen Hedge Fund 3AC’s Founder Says FTX Set Crypto Back Years (4:47 a.m.)
High-profile crypto crises could set the industry back by almost a decade, according to the co-founder of Three Arrows Capital.
“Some industry leaders have said the FTX collapse set the industry back by five years,” Su Zhu said in a rare in-person interview in Abu Dhabi. “I think it’s even longer than that — seven or eight years — maybe even longer, if the underlying issues aren’t solved.”
FTX Group Bankruptcy Filing Shows Cash Balance of $1.24 Billion (1:30 p.m. HK)
An FTX bankruptcy filing showed that, as of Nov. 20, the exchange and a number of affiliates had a combined cash balance of $1.24 billion — more than the debtors identified last week.
The document from Alvarez & Marsal North America LLC, the proposed financial adviser to FTX, said trading house Alameda and related firms had a cash balance of almost $401 million.
Bahamas Agrees to Let Delaware Judge Handle Part of FTX Meltdown (8 a.m. HK)
Bahamas court officials dropped their opposition to moving one piece of FTX’s restructuring case to a US court in Delaware, according to a court filing.
Liquidators appointed in the Bahamas for one FTX affiliate agreed to move a case they filed in New York to Delaware, where more than 100 units are under the oversight of a federal judge, FTX lawyers said in papers filed in US Bankruptcy Court in Wilmington, Delaware.
Tom Brady, Steph Curry Draw Texas’ Scrutiny Over FTX Plugs (7:15 a.m. HK)
A Texas regulator is scrutinizing payments received by celebrities to endorse FTX US, along with what disclosures were made and how accessible they were to retail investors
Tampa Bay Buccaneers quarterback Tom Brady and the Golden State Warriors’ Steph Curry are among the high-profile people being investigated.
Crypto Firm Genesis Said to Warn of Bankruptcy (6 a.m. HK)
Digital-asset brokerage Genesis is struggling to raise fresh cash for its lending unit, and it’s warning potential investors that it may need to file for bankruptcy if its efforts fail, according to people with knowledge of the matter.
Genesis, which has faced a liquidity crunch in the wake of crypto exchange FTX’s bankruptcy filing this month, has spent the past several days seeking at least $1 billion in fresh capital, the people said.
–With assistance from Taryana Odayar.
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