FTX Crypto Exchange Boss Says He Is Trying to Raise More Money

On Wednesday evening, Sequoia Capital, one of FTX’s largest backers, said it now considered its $213 million investment worthless in a letter to its own investors. The firm said FTX was at risk of bankruptcy, though it didn’t know “the full nature and extent” of the risk.

An FTX spokesman declined to comment. The memo was earlier reported by Reuters.

FTX is under investigation by the Securities and Exchange Commission, according to two people familiar with the matter. The Commodity Futures Trading Commission is also looking into the collapse. One issue that regulators are examining is whether customer funds were misused by FTX to prop up Alameda, a trading firm that Mr. Bankman-Fried establishment and which remains closely tied to the exchange.

The firm’s collapse has also shaken FTX’s employees, some of whom say they feel betrayed. Many staff received their salaries through deposits into their FTX accounts, meaning the implosion of the company could drain their savings, according to a person familiar with the matter.

In the memo to employees, Mr. Bankman-Fried apologized for the chaos. “Ultimately it’s my responsibility to make sure the right things happen,” he said.

He said that two executives, Ryne Miller and Zach Dexter, were handling day-to-day operations at the firm’s US arm, and that Constance Wang, the firm’s chief operating officer, was involved in the fund-raising efforts.

Mr. Bankman-Fried, in a somewhat unusual move, also took to Twitter on Thursday morning to post a mea culpa of sorts, in which he said, “I’m sorry,” and “should have done better.” In a series of posts, he said he could not communicate more with customers and investors because his “hands were tied during the duration of the possible Binance deal.”

An attorney for Mr. Bankman-Fried at the law firm Paul Weiss did not return a request for comment.

This is a developing story. Check back for updates.

Erin Griffith contributed reporting.

Leave a Reply

Your email address will not be published. Required fields are marked *