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Your Evening Briefing: Crypto Collapse Brings Biggest Bankruptcy of 2022

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Sam Bankman-Fried, founder of FTX Cryptocurrency Derivatives Exchange, speaks during a Senate Agriculture, Nutrition and Forestry Committee hearing in Washington on Feb. 9.

Sam Bankman-Fried, founder of FTX Cryptocurrency Derivatives Exchange, speaks during a Senate Agriculture, Nutrition and Forestry Committee hearing in Washington on Feb. 9.

Photographer: Bloomberg 

Sam Bankman-Fried’s digital-asset empire filed for Chapter 11 bankruptcy, capping the downfall of one of crypto’s wealthiest and most influential moguls and his collection of high-flying ventures, including exchanges and a massive trading operation. More than 130 entities tied to FTX.com, FTX US and trading firm Alameda Research were listed in filings at federal court in Delaware, with the Alameda petition denoting assets and liabilities of at least $10 billion each. That easily makes it the biggest bankruptcy in the US this year, affecting investors and other counterparties around the world. The Securities and Exchange Commission and the Justice Department are already looking into the matter. 

For a little while, it appeared some of FTX’s American customers might escape the worst-case scenario: then the worst happened. “The company and Sam Bankman-Fried seemed trustworthy,” said Justin Zhang, a 34-year-old engineer. “I thought FTX US was different because of all the regulations put in place, but it’s not.”

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