The rise and fall of crypto exchange FTX

STORY: The rise and fall of FTX

May 2019

Former Wall Street trader Sam Bankman-Fried and ex-Google employee Gary Wang

founded cryptocurrency exchange FTX

FTX supported its native token, FTT

July 2021

A $900 million funding round valued FTX at $18 billion

October 2021

FTX raised capital at a valuation of $25 billion

from investors including Singapore's Temasek and Tiger Global

January 2022

FTX raised $400 million from investors including SoftBank at a valuation of $32 billion

August 2022

A U.S. bank regulator ordered FTX to halt 'false and misleading' claims it had made

about whether funds at the company were insured by the government

November 2, 2022

Crypto news website CoinDesk reported a leaked balance sheet

that showed Alameda Research was heavily dependent on FTX's native token, FTT

Alameda Research is Bankman-Fried's crypto trading firm

Reuters was unable to verify the report

(Charley Cooper, Managing Director of R3)

“Based on what we appear to know, several things happened. The first problem is much of their balance sheet was in the very token they created, which no one really knew how much it was valued at.”

“The second thing is, more reports are coming out that it appears customer funds have gone missing. What that means is various different clients of FTX that trusted their money to the company over the last few days have sought to withdraw that money and have been told they're unable to do it."

November 6

Binance CEO Changpeng Zhao said his firm would liquidate its holdings of FTT

due to unspecified 'recent revelations'

November 8

FTT collapses by 72% as clients swamp the exchange with withdrawal requests

November 9

Binance decided against pursuing a nonbinding agreement to bail out FTX

A day later, FTX suspended on-boarding of new clients and withdrawals until further notice

(Charley Cooper, Managing Director of R3) “This is a black eye on the crypto industry. This was seen as an incredibly established blue chip company to the extent they exist in crypto.And when that company is going down, it really does create a mark on the industry that even the apparent good guys don't look so good anymore.”