Bankman-Fried led FTX as a personal fief, according to the court

ftx founder Sam Bankman-Fried led the cryptocurrency exchange before its implosion as his "personal fief", said a lawyer who worked on the bankruptcy, whereby "considerable amounts of money" were spent on items that have nothing to do with business, such as holiday homes on the Bahamas.

"We experienced one of the most abrupt and difficult breakdowns in the history of American companies," said James Bromley from Sullivan & Cromwell before a US court on Tuesday. He added that the bankruptcy proceedings "made it possible for everyone to look under the ceiling and realize that the emperor had no clothes".

ftx applied for US insolvency protection on November 11th when its customers fled and managers discovered missing funds in billions in billions, which tightened the turbulence on the cryptocurrency markets.

The attempted attempt to identify a complex network of assets with the processing of FTX tries to repay the creditors. The case was characterized by accusations for misconduct and serious government errors as well as a dispute between the United States and the Bahamas, where the small inner circle of FTX was running the business.

According to the company, the overall rating of FTX achieved a maximum of $ 40 billion-$ 32 billion for its international business and $ 8 billion for its US activities based on funds that were raised by risk capital investors.

Bromley said the bankruptcy team found that "significant funds" were transferred from the stock exchange to Bankman-Frieds Krypto Hedge Gunde Alameda Research and "significant amounts of money were spent on things that had nothing to do with business".

This included real estate worth around $ 300 million on the Bahamas, which were "houses and holiday properties used by the executives of FTX," he said.

The Alameda Hedge Gunds also seems to have used FTX funds to make billions of dollars of illiquid risk investments in funds such as Sequoia Capital and companies such as Elon Musk.

ftx requested insolvency protection for an "effective run on the bench," said Bromley, after the rivalry crypto exchange Binance had passed to liquidate its FTT-TOKEN, the cryptocurrency issued by FTX. The token lost 80 percent of its value within two days and crashed from a maximum of $ 9.6 billion overall market value to just $ 422 million.

Bromley also announced that the team of lawyers and investigators who are working on bankruptcy would examine a transaction between FTX and Binance last year. The competing crypto exchange, which is operated by Changpeng Zhao, has sold a capital participation in FTX for around $ 2.1 billion in cash and cryptocurrencies.

ftx is now led by his new Chief Executive and Chief Restructuring Officer John J Ray III. The bankruptcy team includes investigative companies such as Kroll, the blockchain research group Chainalysis and a cyber security company, the identity of which was not disclosed due to security concerns while fighting for hacker attempts on FTX and its assets.

Bromley added that the company works with the US government and international supervisory authorities who are interested in the collapse of the FTX, including the US Justice Ministry and the Securities and Exchange Commission.

Prosecutors who work with the southern district of the Ministry of Justice in New York and the investigative department for financial crime for the Bahamas have initiated two separate criminal investigations into the Implosion of FTX.

A list of the 20 largest creditors in the FTX shops was sealed by the court. However, the US bankruptcy judge John Dorsey ordered the lawyers to publish the names of individuals and organizations in the insolvency believer committee, which probably includes institutional investors who have acquired shares in FTX.

Dorsey also approved the applications of FTX to pay remaining employees and suppliers.