Kaplan Fox Investigates Liquidity Crisis at Cryptocurrency Platform FTX
NEW YORK, Nov. 10, 2022 (GLOBE NEWSWIRE) — Kaplan Fox & Kilsheimer LLP (www.kaplanfox.com) is investigating potential claims concerning the crypto exchange platform FTX Trading LTD d/b/a FTX, FTX US, their founder and CEO Sam Bankman-Fried, and Alameda Research, a related party cryptocurrency trading firm.
If you have been affected by the recent revelations concerning FTX and would like to discuss our investigation, please contact us by emailing jcampisi@kaplanfox.com or by calling (212) 687-1980.
Starting on November 2, 2022, news emerged that Alameda Research faced a liquidity crisis after Alameda’s balance sheet was leaked. According to a Coindesk article, one industry expert observed “It’s fascinating to see that the majority of the net equity in the Alameda business is actually FTX’s own centrally controlled and printed-out-of-thin-air token”.
Then it was revealed that FTX Chief Executive Sam Bankman-Fried told an investor this week that Alameda owes FTX about $10 billion. FTX reportedly extended loans to Alameda using money that customers had deposited on the exchange for trading purposes. FTX reportedly had $16 billion in customer assets and lent more than half of its customer funds to Alameda.
FTX paused customer withdrawals earlier this week after it was hit with roughly $5 billion worth of withdrawal requests, according to a tweet from Mr. Bankman-Fried. The crisis forced FTX to scramble for an emergency investment. “We’re spending the week doing everything we can to raise liquidity,” FTX CEO Sam Bankman-Fried said in a tweet. As of this afternoon, FTX’s website for U.S. users says that it is currently unable to process withdrawals and “strongly advises” against making deposits.
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If you have any questions about this investigation, please contact:
Jeffrey P. Campisi
KAPLAN FOX & KILSHEIMER LLP
850 Third Avenue, 14th Floor
New York, New York 10022
(212) 687-1980
E-mail: jcampisi@kaplanfox.com
Laurence D. King
KAPLAN FOX & KILSHEIMER LLP
1999 Harrison Street, Suite 1560
Oakland, California 94612
(415) 772-4704
Fax: (415) 772-4707
E-mail: lking@kaplanfox.comox.com
