FTX to Bail Out Bankrupt Voyager Customers to Cash Out Early
Crypto trading exchange FTX is planning to offer early liquidity to customers of bankrupt crypto lender Voyager Digital.
Sam Bankman-Fried, founder and CEO of the leading exchange FTX, has offered to provide early liquidity to Voyager Digital’s clients, according to an announcement made by FTX on July 22. Furthermore, Bankman-Fried discussed the crypto industry with CNBC in an exclusive interview, and noted his willingness to deploy “hundreds of millions beyond what we have thus far” to help digital currency firms affected by the crypto market downturn.
FTX Proposes to ‘Provide Early Liquidity to Customers of Voyager’
Not too long ago on June 28, Sam Bankman-Fried told Forbes author Steven Ehrlich that some crypto firms were “secretly insolvent” and he warned more insolvencies were coming. The FTX CEO’s words came true, as more companies with financial issues followed the problems customers were having with Celsius freezing withdrawals. Celsius eventually filed for bankruptcy protection alongside Three Arrows Capital, and Voyager Digital.
On July 22, Bankman-Fried tweeted out a statement that explains FTX is willing to help Voyager’s customers. “Happy to do what we can to get liquidity to Voyager’s customers,” Bankman-Fried said in his tweet. A press release shared by Bankman-Fried notes that FTX announced a joint offer with West Realm Shires Inc., the owner and operator of FTX US, and Alameda Ventures. The company plans to “provide early liquidity to customers of Voyager.” Bankman-Fried said he wanted to offer a better way to help customers get liquidity.
The FTX CEO said:
Voyager’s customers did not choose to be bankruptcy investors holding unsecured claims. The goal of our joint proposal is to help establish a better way to resolve an insolvent crypto business – a way that allows customers to obtain early liquidity and reclaim a portion of their assets without forcing them to speculate on bankruptcy outcomes and take one-sided risks.
Bankman-Fried’s CNBC Interview Discusses FTX Ready to Help Troubled Crypto Companies With ‘Hundreds of Millions’ — FTX CEO’s Crypto Regulation Comments Criticized by Shapeshift Founder
On July 22, Bankman-Fried did an interview for CNBC’s “Closing Bell,” and said FTX was willing to deploy “hundreds of millions beyond what we have thus far” to crypto firms suffering from the downturn. Bankman-Fried further said that he would love to see more people stepping in to “[provide] capital to those in need.” The news follows the FTX CEO explaining that the company was ready to spend billions on mergers and acquisition deals at the end of May.
The FTX CEO also talked about cryptocurrency markets and noted that he believes crypto regulations will rise in the near future. The interview with Bankman-Fried also touched upon the cryptocurrency insider trading case launched by the U.S. Securities and Exchange Commission (SEC). Following the interview, the founder of Shapeshift, Erik Voorhees tweeted about Bankman-Fried’s recent oversight comment the CEO of FTX shared on Twitter.
In a specific tweet, Bankman-Fried said: “In the end, I want federal oversight of crypto one way or another.” Voorhees remarked that Bankman-Fried’s regulation statements was “the way toward crypto becoming banking 2.0, instead of an actual meaningful change in how money and finance work.”
“If you care about improving the world with this tech, please avoid this impetus,” added Voorhees. You’ve already built an impressive crypto empire [Sam Bankman-Fried]. Please use it for good, and not to entangle us back into the legacy system that is so deeply corrupted and perverse.”
What do you think of Sam Bankman-Fried and FTX’s offering to help troubled crypto companies weather the storm? And what do you think about Bankman-Fried’s oversight comment?