CRYPTO CRIMINAL CAPITALI$M

FTX has a massive $9.5 billion shortfall in top crypto and cash needed to repay customers, the bankrupt exchange's new bosses say

Ryan Hogg
Fri, March 3, 2023 

Sam Bankman-Fried.AP Photo/Seth Wenig

FTX has a $9.5 billion shortfall in top crypto and cash to repay customers, bankruptcy lawyers say.


Just $694 million in assets of $2.2 billion recovered are easy to cash in.


The group said it also lent $9.3 billion to Sam Bankman-Fried's Alameda Research.

FTX has identified a $9.5 billion shortfall in top crypto and cash needed to repay customers, its new bosses have said, with just $694 million in currency that's easy to cash in.

In a press release on Thursday, FTX shared the extent of the company's deficit as bankruptcy lawyers scramble to unravel a mess that led to billions of dollars' worth of customer funds getting lost.

The bankrupt crypto exchange's new executives have so far identified $2.2 billion in assets in the company's wallets, of which only $694 million were in the most liquid currencies, like fiat, stablecoins, bitcoin, or ethereum.

Lawyers have also identified $385 million of customer receivables, and substantial claims against Bankman-Fried's Alameda Research, the company at the center of FTX's controversial collapse. FTX lent $9.3 billion to Alameda, they said.

"It has taken a huge effort to get this far. The exchanges' assets were highly commingled, and their books and records are incomplete and, in many cases, totally absent," CEO John Ray wrote.

"For these reasons, it is important to emphasize that this information is still preliminary and subject to change."

FTX US also has a shortfall, with $191 million in assets versus $335 million of customer claims and $283 million of related party claims payable.

In January, bankruptcy lawyers said they had recovered $5.5 billion in liquid assets from FTX.

But lawyers still don't know the extent of losses to customer funds, which burned famous faces like Tom Brady and Kevin O'Leary. The Commodities and Futures Trading Commission (CFTC) has estimated that $8 billion of client money had been lost by the exchange.

Its latest presentation suggested there is a $9.5 billion deficit across its most liquid assets, and a $733 million surplus in category B assets — those which are harder to retrieve — including through the FTX native coin FTT.

It was reported in November that FTX could have one million creditors.