Bahamas’ financial regulator has appointed liquidators as bankruptcy administrators for the FTX cryptocurrency exchange. This is in response to the need to protect creditors of Sam Bankman Fried’s empire that was once valued at $32 Billion.
According to the Bahamas Securities Commission, the bankruptcy of FTX Digital Markets which is the foundation of the cryptocurrency holdings will be supervised both by partners of PwC (one in the Bahamas and one in Hong Kong). The agency also requested approval to appoint Brian Simms KC as interim liquidator. He is a senior partner at Lennox Paton.
The investigation will be conducted by the country’s authorities into the activities and transactions of FTX. FTX was based in Nassau and offered trading in cryptocurrency derivatives. It also accepted money from clients all over the globe. The agency stated that due to the international impact and urgency of the collapse FTX’s operation, it was important to act quickly to further protect customers, creditors, and other stakeholders.
FTX filed for bankruptcy last Friday under Chapter 11 of US Bankruptcy Law. According to the Financial Times, there are more than 100 000 creditors on the platform. However, this number could rise to 1 million in the future. The company has been cooperating with the US Attorney General in recent days. “Dozens federal and international regulators”. The US Securities and Exchange Commission (SEC), has increased its scrutiny of FTX’s activities regarding cryptocurrency lending and client money management.
According to the Royal Bahamas Police, it cooperates with the local financial regulator and will investigate criminal offenses if any relevant facts are found. In response to the incident, the authorities also indicated that they would work together with other countries’ supervisory authorities. “multi-jurisdictional character”.