Major crypto exchange goes bust

FTX announced the launch of bankruptcy proceedings via Twitter on Friday

Cryptocurrency exchange FTX has commenced voluntary bankruptcy proceedings in the US, the platform announced on Friday.

The company will begin “an orderly process to review and monetize assets for the benefit of all global stakeholders,” FTX said in a statement on Twitter.

Chief Executive Sam Bankman-Fried resigned, and a new CEO, John J. Ray III, was appointed, the exchange added.

The announcement comes days after larger rival Binance abandoned plans to acquire FTX and left the exchange with the task of raising roughly $9 billion from investors and rivals to stay afloat.

READ MORE: JPMorgan warns of Bitcoin crash

Binance backed out of the deal after a due diligence examination and recent reports of mishandled customer funds, as well as alleged investigations by the US authorities into the company. Abandonment of the deal triggered a meltdown in the cryptocurrency market, with the price of Bitcoin sinking to its lowest level in two years.

The initiation of bankruptcy proceedings by FTX may trigger what could be one of the biggest meltdowns in the industry, according to Reuters.

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