A list of the top 50 creditors of the FTX group of companies has been filed with the bankruptcy court, and the sum total amounts to $3.1 billion.
The top two creditors are owed $226 million and £203 million. None of the names of the creditors are included in the list, in line with a request by FTX to shield its clients’ identity for reasons of business competitiveness.
The 50th largest creditor is owed $21.3 million.
Today’s filing uncovers the first concrete details relating to the shape of FTX companies’ liabilities, which are thought to amount to around $10 billion.
Crypto prices faltering after latest FTX news
Bitcoin and other crypto prices have weakened since the news emerged, with total crypto market cap down 1.93% to $821 billion.
Bitcoin has slipped 1.2% in the past 24 hours, trading at $16.497, Ethereum is down 3% at $1,166 and Dogecoin off 6% at $0.079.
However, the poor record-keeping by FTX means that new CEO John Ray cannot be absolutely sure that the top 50 list is accurate.
Also, the delay in producing the list, which is a requirement of Chapter 11 bankruptcy proceedings, has been due to the parlous state of FTX companies’ records.
In the notice filed with the court it states; “…the Top 50 List is based on the Debtors’ currently available creditor information, including customer information that was able to be viewed but is not otherwise accessible at this time. The Debtors’ investigation continues regarding amounts listed, including payments that may have been made but are not yet reflected on the Debtors’ books and records. The Debtors are also working to obtain full access to customer data.”
Ray characterized governance at FTX as a “complete failure of corporate controls” and the worst he had ever seen in his career, which includes clearing up the mess after the infamous Enron collapse in 2007.
Top 10 FTX creditors are owed $100 million-plus each
The consolidated list of creditors shows the largest unsecured claims, although can include secured creditors where the collateral is now inadequate, thus placing the creditor in the unsecured claims list.
The top 10 creditors alone are owed $100 million-plus each and are likely to include hedge funds and other financial companies that traded on the exchange, as well as crypto entities such as lenders.
FTX could have as many as one million creditors and arguments over debt seniority will determine which ones will be paid first.
It has become an area of contention in other crypto bankruptcies, such as Voyager Digital, whether or not a financial institutions with an account at a crypto exchange would be more senior debt than that of other unsecured creditors such as retail clients.
Crypto exchanges are constituted in markedly different ways to the division of labour that exists in traditional finance. Firms such as FTX are part bank, part broker-dealer and part exchange. That means they will acts as custodians and hold large amounts of capital on behalf of clients.
The top 50 list can be viewed here:
Other court filings can be viewed here:
Ellison, Wang and Singh all sacked, CEO Ray is on $1,300 an hour
In other court documents, it has come to light that Caroline Ellison, Gary Wang and Nishad Singh have been sacked.
Also, total FTX employee headcount at the time of the petition declaring bankruptcy was 330 persons based in 29 countries, in addition to contractors. Of the directly employed staff, 140 work in the US.
Documents say that the “Debtors continue to review personnel issues and anticipate, based on the nature of the Debtors’ businesses, that a large number of Employees will need to continue to work for the Debtors for the foreseeable future.”
CEO John Ray is being paid $1,300 an hour for his services and a $200,000 retainer.
The first day’s sitting of the court will take place on Tuesday 22 November at 11am ET, with Judge John T Dorsey presiding.
Vitalik Buterin: “centralized anything is by default suspect”
In other news, Vitalik Buterin, co-founder of Ethereum, has described the FTX implosion as a “huge tragedy”.
But he added, “That said, many in the Ethereum community also see the situation as a validation of things they believed in all along: centralized anything is by default suspect.”
For Buterin the affair is a vindication of the correctness of putting faith in “open transparent code above individual humans”. He noted that DeFi protocols had worked “flawlessly”.
On Sam Bankman-Fried, Buterin tweeted:
Also the relative strength of bitcoin bodes well for the future recovery, according to one trader:
Elsewhere, centralized exchanges continue to attempt to communicate their trustworthiness. To that end, Coinbase has been advertising in the Wall Street Journal:
The week ahead could in the FTX contagion story, could see Digital Currency Group (DCG) at the center of attention and in particular the two companies its owns, Genesis and Grayscale Investments, the latter being the issuer of the Grayscale Bitcoin Trust (GBTC).
Unconfirmed rumors (see tweet below) are circulating that a previously undisclosed promissory note shows that DCG owes Genesis $1.1 billion. Last week Genesis halted withdrawals from its Genesis Earn yield bearing product.
DCG is the largest conglomerate in crypto and owns news site Coindesk as well as having investments in as many as 200 companies, according to some estimates. Research site Messari puts DCG’s disclosed VC investments at 114. DCG is a major investor in Messari.
Meanwhile, in France respected broker Coinhouse revealed that it has exposure to Genesis and as a result is stopping withdrawals from its flagship Savings Account.
Cryptonews conducted an exclusive interview with CEO Nicolas Louvet a week or so ago.
In that interview Louvet spoke out about the need for better regulations in the industry, and suggested that if there were more pros from the VC world involved and independent auditors and ratings agencies, then things could be cleaned up.
Looks like Coinhouse may have failed in its own due diligence, although, to be fair, it was not to know that FTX was going to fail and bring down Genesis – or at least its Earn product – in the process.
Crypto Winter will be longer but there are bright spots
IFTX has certainly set back crypt and is likely to prolong the Winter. Nevertheless, even at this juncture there are profitable opportunities for savvy traders and investors.
So if you are looking to add some alpha to your portfolio, a good place to start is in the presale sector, and we have two interesting propositions for your watchlist – Dash 2 Trade (D2T) and RobotEra (TORA).
Dash 2 Trade is the perfect antidote for a post-FTX world – its trading intelligence tools, signals and metrics will help traders and investors to spot the problems and steer clear.
In a vote of confidence in the project, LBank and, most recently, BitMart have both signed deals to list the token after its presale ends. You can buy D2T now in presale for $0.0513.
The second project is RobotEra, which could be the next hot metaverse gaming project.
The gaming platform is similar to The Sandbox but better – you build planets using robots. Its TARO token is on sale now for $0.020. Only days into its presale it has already raised $100,000.
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