FTX Digital Markets, the Bahamas-based unit of the recently collapsed cryptocurrency trading platform, has filed for bankruptcy protection in the U.S., CNN reported. The company filed Tuesday in New York court under chapter 15. The move comes after the crypto exchange’s U.S.-based arm, FTX Group, abruptly filed for bankruptcy Friday after facing a “severe liquidity crisis.” FTX founder Sam Bankman-Fried resigned as CEO the same day. FTX’s rapid collapse marked a stunning downfall for one of the biggest and most powerful players in the crypto industry.
Liquidators for FTX's Bahamas unit, FTX Digital Markets, have asked a New York City court to recognize its bankruptcy in the Bahamas, saying they "reject the validity" of the cryptocurrency exchange's U.S. bankruptcy proceedings, Saltwire reported. The Bahamas liquidators, who were appointed on Nov. 10 by the Securities Commission of the Bahamas, filed a chapter 15 petition late Tuesday in U.S. bankruptcy court in New York, asking the court to help them obtain records from FTX and block asset transfers to protect creditors of the Bahamas-based company.
The Securities Commission of the Bahamas said that it froze the assets of FTX Digital Markets Ltd. and related parties on Thursday and appointed a provisional liquidator, WSJ Pro reported. FTX Digital Markets, based in the Bahamas, is a subsidiary of FTX Trading Ltd. owned by billionaire Sam Bankman-Fried. The powers of the directors of FDM have been suspended and no assets held by the firm can be transferred without the provisional liquidator’s approval, the commission said.
Insolvency practitioners yesterday said the Attorney General’s ambition for The Bahamas to become “the near shore Delaware of corporate structuring” was both “achievable” and “appropriate” if the correct reforms are made, the Bahamas Tribune reported. Ed Rahming, Intelisys (Bahamas) founder and managing director, told Tribune Business that this nation would need to ensure it has both the right legislative framework and necessary human capital expertise - both Bahamian and expatriate - to fulfill the vision unveiled by Ryan Pinder during the Senate Budget debate.