FTX Opts for Capital Raise as Alameda Research Winds Down on Trading

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, FTX Opts for Capital Raise as Alameda Research Winds Down on Trading

Troubled cryptocurrency exchange FTX has opted to raise capital to fill a shortfall as large as $8 billion in its finances. Reuters reports that the exchange will conduct a fundraise next week.

This is even as rival crypto exchange Binance on Wednesday bailed out of a non-binding agreement to take over the former’s non-US operations. The development comes a day after Founder and CEO Sam Bankman-Fried told investors during a call that he was hoping FTX could raise between $3 billion to $4 billion in equity and debt to cover the shortfall.

In a memo seen by Reuters, Bankman-Fried told staff members that he had a discussion on the matter with Justin Sun, the founder of the blockchain Tron and the cryptocurrency token Tronix. Meanwhile, Sun tweeted early on Thursday that his firm was “putting together a solution” for FTX. The goal is to “initiate a pathway forward” for the exchange, he said.


In a series of tweets later on Thursday, Bankman-Fried also noted that he and his team were “doing everything we can to raise liquidity”.

Alameda Research

Also, Bankman-Fried in his Thursday tweet disclosed that FTX’s corporate sibling Alameda Research is gradually drawing its trading activities to a close. The subsidiary, which is based in Hong Kong, is a quantitative cryptocurrency trading firm that provides liquidity to digital assets markets.

This is even as a recent review of a private document by CoinDesk showed that Alameda Research’s balance sheet is full of FTX tokens (FTT), suggesting stronger ties to FTX.

This likely explains why the subsidiary of the Bahamas-based cryptocurrency exchange intends to wind down on its trading activities.

As of June 30, Alameda Research’s assets totaled around $14.6 billion with “unlocked FTT tokens” accounting for 25% or $3.66 million, the firm’s single biggest asset. Furthermore, CoinDesk’s review found that 15% or $2.16 billion of Alameda Research’s assets was held in “FTT collateral”.

On the liability side, the outlet found that loans accounted for 92.5% of the trading firm’s $8 billion of liabilities, amounting to $7.4 billion of loans. Again, of the total liability, $292 million was in “locked FTT”.

Troubled cryptocurrency exchange FTX has opted to raise capital to fill a shortfall as large as $8 billion in its finances. Reuters reports that the exchange will conduct a fundraise next week.

This is even as rival crypto exchange Binance on Wednesday bailed out of a non-binding agreement to take over the former’s non-US operations. The development comes a day after Founder and CEO Sam Bankman-Fried told investors during a call that he was hoping FTX could raise between $3 billion to $4 billion in equity and debt to cover the shortfall.

In a memo seen by Reuters, Bankman-Fried told staff members that he had a discussion on the matter with Justin Sun, the founder of the blockchain Tron and the cryptocurrency token Tronix. Meanwhile, Sun tweeted early on Thursday that his firm was “putting together a solution” for FTX. The goal is to “initiate a pathway forward” for the exchange, he said.


In a series of tweets later on Thursday, Bankman-Fried also noted that he and his team were “doing everything we can to raise liquidity”.

Alameda Research

Also, Bankman-Fried in his Thursday tweet disclosed that FTX’s corporate sibling Alameda Research is gradually drawing its trading activities to a close. The subsidiary, which is based in Hong Kong, is a quantitative cryptocurrency trading firm that provides liquidity to digital assets markets.

This is even as a recent review of a private document by CoinDesk showed that Alameda Research’s balance sheet is full of FTX tokens (FTT), suggesting stronger ties to FTX.

This likely explains why the subsidiary of the Bahamas-based cryptocurrency exchange intends to wind down on its trading activities.

As of June 30, Alameda Research’s assets totaled around $14.6 billion with “unlocked FTT tokens” accounting for 25% or $3.66 million, the firm’s single biggest asset. Furthermore, CoinDesk’s review found that 15% or $2.16 billion of Alameda Research’s assets was held in “FTT collateral”.

On the liability side, the outlet found that loans accounted for 92.5% of the trading firm’s $8 billion of liabilities, amounting to $7.4 billion of loans. Again, of the total liability, $292 million was in “locked FTT”.

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