LeoGlossary: FTX

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LeoFinance
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A cryptocurrency exchange that is headquartered in the Bahamas. It was founded by Sam Bankman-Fried in 2019.

In 2022, it was reported that the exchange was doing over $10 billion per day with over 1 million users.

On November 11, 2022, the company filed bankruptcy and Sam Bankman-Fried stepped down as CEO. The company was taking customers funds, transferring them to it Alameda arm, which engaged in leverage trading. This ultimately led to a liquidity crisis where there was not the money, due to losses, to cover the withdrawal requests from customers.

The events that led to the bankruptcy, and aftermath, led many to conclude this was nothing more than a Ponzi scheme. Bankman-Fried is facing charges from a number of entities over the firm's conduct.

BlockFi

On July 1, 2022, FTX received an option to buy troubled cryptocurrency lender Blockfi. The price was a maximum of $240 million with no minimum price set. The company also agreed to increase its revolving credit line to $400 million.

BlockFi ran into issues during the crypto bear market where many firms that were overextended ended up filing bankruptcy.

Related:

Crypto Companies

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