The company in charge of securing the assets of the bankrupt cryptocurrency exchange FTX Trading said that it had found $740 million in assets so far. This is small compared to the billions of dollars probably missing from FTX’s accounts.
BitGo, a company that stores cryptocurrency, said the number in court documents on Wednesday. This month, BitGo filed for bankruptcy, and FTX hired the company immediately.
Many of FTX’s customers are most worried about whether or not they’ll ever get their money back. Experts told CBS MoneyWatch that customers will likely have to wait years to get their money back and that many of them may never get back.
Sam Bankman-Fried, FTX’s founder and former CEO, and his top aides used customer funds to make bets in Bankman-trading Fried’s firm, Alameda Research. This caused FTX to fail. The $740 million number is from November 16, and since then, more and more assets have been found.
The collapse of FTX, one of the biggest exchanges, in about a week has sent shockwaves through the crypto world.
The company and Bankman-Fried are being looked into both in the U.S. and abroad for possible securities violations. A few days after FTX filed for bankruptcy in the U.S., securities regulators in the Bahamas, where the company is based, took some of its assets.
California and Texas have also said that they are looking into FTX.
This month, FTX’s problems became clear when Bankman-Fried told a group of investors that the company needed about $8 billion to protect the crypto assets of its users. The company had the equivalent of a bank run earlier this month when users pulled out about $5 billion in a single day because they were worried about FTX’s ability to pay.
1/ Big picture: FTX’s collapse has shaken the #crypto market. But this is not the first time crypto has faced significant turmoil related to the collapse of an exchange.
— Chainalysis (@chainalysis) November 23, 2022
Bankman-Fried said on Twitter on Wednesday that on November 30, he will be speaking at a New York Times event.
BitGo’s recovered assets are now in “cold storage” in South Dakota. This means that the cryptocurrency is stored on hard drives that are not connected to the Internet. South Dakota state law says that BitGo is a “qualified custodian,” which is what BitGo does.
“Institutions trading in crypto have been left wondering who they can trust, if the supposedly rock-solid FTX could collapse so quickly. Managers have been pulling money from exchanges out of caution.”
“supposedly rock-solid”… https://t.co/acK6FRmbNQ
— John Tasioulas (@JTasioulas) November 22, 2022
Not only were Bitcoin and Ethereum found, but also a group of smaller cryptocurrencies with varying popularity, like the Shiba Inu coin.
California-based BitGo has a history of getting assets back and keeping them safe. After the cryptocurrency exchange Mt. Gox failed in 2014, it was their job to protect the assets. The company is also in charge of the assets owned by the government of El Salvador.
Stay tuned for more updates on NogMagazine.com
Jessa Martin is the author of Nogmagazine, A professional in writing by day, and novelist by night, she received her bachelor of arts in film from Howard University and her master of arts in media studies from the New School. A Brooklyn native, she is a lover of naps, cookie dough, and beaches, currently residing in the borough she loves, most likely multitasking.