By Leah Montebello
Collapsed crypto exchange FTX said it has launched a strategic review of its global assets and is preparing for the sale or reorganisation of some of its businesses, just a week after it filed for bankruptcy.
FTX said the review of its global assets would “begin to maximize recoverable value for stakeholders”.
In a filing this morning, the exchange, along with about 101 affiliated firms, have now sought court relief to allow the operation of a new global cash management system and payment to its critical vendors.
The filing asked for permission to pay prepetition claims of up to $9.3m to its critical vendors after an interim order and up to $17.5m after the entry of the final order.
“Based on our review over the past week, we are pleased to learn that many regulated or licensed subsidiaries of FTX, within and outside of the United States, have solvent balance sheets, responsible management and valuable franchises,” FTX’s new chief exec John Ray said.
Earlier this week, Ray slammed a “complete failure of corporate controls” and “absence of trustworthy financial information” at the firm.
John Ray III, who oversaw the winding up of fraudulent energy firm Enron in the early 2000s, was parachuted in to take over from ousted founder Sam Bankman-Fried to oversee the winding up of the firm, after it collapsed, leaving an estimated one million customers and other investors facing total losses in the billions of dollars.
“Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here,” he said in court filings published on Thursday.”
“From compromised systems integrity and faulty regulatory oversight abroad, to the concentration of control in the hands of a very small group of inexperienced, unsophisticated and potentially compromised individuals, this situation is unprecedented.”
Ray has form in helping the customers of collapsed firms recoup some of their losses, having recently worked on failed mortgage lender Residential Capital, in which he helped recover $1.8bn for creditors by suing mortgage originators.
As chief of Enron during its years-long bankruptcy, Ray struck settlements with lenders accused of helping it deceive investors, including a $1.66bn settlement with Citigroup in 2008.
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