This week in crypto: The FTX saga continues to unfold

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This week in crypto: The FTX saga continues to unfold

By Hassan Maishera - min read

Companies affected by FTX’s recent collapse are starting to come out, with bankruptcy filing currently underway.

Numerous companies affected by FTX’s collapse

FTX filed for chapter 11 bankruptcy last week, a move that saw one of the biggest crypto exchanges in the world, crumble. Several companies have come out over the past few days to reveal the losses incurred from FTX’s collapse. 

Liquid, a Japan-based cryptocurrency exchange, halted withdrawals earlier this week, citing FTX’s collapse. The crypto exchange was acquired by FTX in February this year and is now affected by the events.

Crypto lending platform Salt is another company that halted withdrawals due to FXT’s liquidation. Nigerian crypto startup Nestcoin revealed that it had more than $4 million stuck on FTX. As a result, the company said it would lay off more than 50% of its staff and cut back on other expenses. 

BlockFi is preparing to file for Chapter 11 bankruptcy, citing “significant exposure to FTX and associated corporate entities. This comes after BlockFi, and FTX US signed a credit deal earlier this year.

As the case unfolds, the Securities Commission of the Bahamas, revealed earlier this week that it had seized assets belonging to FTX Digital Markets, the parent company of FTX and FTX US. The move came after assets began to disappear from FTX Digital Markets’ accounts.

Meanwhile, the former CEO Sam Bankman-Fried claimed that FTX US had enough assets to repay all customers. Bankman-Fried, alongside other Alameda Research executives, is set to testify at an upcoming House Financial Services Committee hearing on FTX’s collapse. Finally, the Australian Securities and Investments Commission (ASIC) suspended the licence issued to FTX Australia earlier this week. 

OKX to launch a $100 million market recovery fund

Following FTX’s collapse, some crypto exchanges are taking action to further protect their customers. OKX exchange revealed earlier this week that it would set up a $100 million market recovery fund.

The fund would provide assistance to blockchain projects struggling due to issues such as a lack of financing. 

Binance’s expansion continues

In a week dominated by FTX news, Binance continues to cement its place as the leading crypto exchange in the world. The crypto exchange revealed earlier this week that it had received a regulatory nod from Abu Dhabi’s Financial Services Regulatory Authority to provide institutional crypto custody, 

Binance.US, the American arm of Binance, is preparing to bid for bankrupt lender Voyager Digital. Binance US previously lost a bid to acquire Voyager Digital to FTX US. However, with FTX now bankrupt, Binance US is set to make another bid for the company.

Binance also announced the launch of the CR7 NFT Collection. This is the first NFT collection by the popular football star Cristiano Ronaldo and will include seven animated collectibles with four rarity levels.

Bitstamp registers with the Spanish central bank

Luxembourg-based exchange, Bitstamp, revealed earlier this week that it had secured its registration in Spain’s central bank. This latest development means that the exchange can now legally provide its services to its users in Spain, both for fiat currency and digital assets.