FTX could head towards bankruptcy without more funding, SBF cautions

Sahana Kiran
Source – Unsplash

2022 was all about the bear market and the bankruptcies that came along with it. A plethora of prominent crypto firms were seen filing for bankruptcy over the last couple of months. It looks like this list would soon witness the inclusion of another popular exchange. The downfall of FTX sent shockwaves throughout the ecosystem. However, CEO Sam Bankman-Fried’s comments on FTX being on the brink of bankruptcy was even more shocking.

According to a recent Bloomberg report, SBF told the investors that the firm had encountered a shortfall of $8 billion. The exchange needed about $4 billion to remain solvent. If FTX failed to amass these funds, the exchange would be headed toward bankruptcy.

During a conference call, SBF reportedly admitted that he “f—ed up.” He even suggested that he would be “incredibly, unbelievably grateful” if investors came forward to provide aid to SBF’s sinking ship, FTX.

Binance emerged as a saving grace with an acquisition deal. However, rumors about the exchange backing out surfaced through the crypto-verse. Bloomberg further highlighted that SBF constantly affirmed that Changpeng Zhao, the CEO of Binance wasn’t walking away from the deal.

But things went haywire and the exchange affirmed that the “issues are beyond our control or ability to help.” Therefore, the deal fell apart.

The community remains skeptical of investors coming to save the troubled firm now that federal authorities were involved.

Tron’s Justin Sun to the rescue?

With FTX abruptly pausing withdrawals, fear was instilled among its users. While industry players were busy elaborating on their exposure to FTX, Justin Sun, the founder of Tron wanted to help FTX customers. In a recent Twitter thread, he affirmed that his team was “working around the clock to avert further deterioration. “

Further providing limited details, Sun said,

“I have faith that the situation is manageable following the wholistic approach together with our partners.”