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Bankruptcy ‘FTX’, Reopening?… Own Coin Soars by 30%

[Seoul=Newsis] Reporter Lee Ji-young = FTX, which shocked the cryptocurrency sector last year due to insolvency, has hinted at reopening. In response to the news, the value of FTX’s own coin, ‘FTT,’ increased by more than 30%.

FTX is a global virtual asset (virtual currency) exchange that is the industry’s second largest after Binance.

However, in November of previous year, excessive FTT-based loans and investments resulted in bankruptcy.

Because their funding lines were stopped following the FTX bankruptcy, worldwide virtual asset lending companies who dealt with them also suffered a serial bankruptcy issue.

In the midst of the FTX bankruptcy, Gopax, a domestic virtual asset exchange, has also banned withdrawals from its own deposit service, Gopai.

This is due to 175 million dollars (roughly 222.5 billion won) in funds from Genesis, a GoFi partner, becoming entangled in the FTX account and ceasing repayment.

According to the industry on the 20th, John J Ray III, CEO of FTX, stated on the 19th (local time) in an interview with the Wall Street Journal, “We have organised a task force (TF) to restore FTX operations.”

Ray was selected as the representative of FTX founder Sam Bankman Fried, who declared bankruptcy.

He is well-known for managing and supervising the restructuring of failing firms.

“Although some of the senior executives have been accused of misconduct, we believe it’s worth reopening the exchange because some of our clients respect the company’s technology so highly,” Lay said in an interview. If there is, I will not only look for it, but I will also put it into action.”

With the potential coming directly from the present head, the initiative to revive FTX is expected to gather traction.

However, it is questionable whether all of the damage suffered by the prior bankruptcy can be recovered for FTX clients.

Indeed, FTX has already indicated that its virtual assets are far insufficient in comparison to the monies it has available to repay to clients. Meanwhile, the price of FTT (FTX Token) has risen as a result of the reopening.

According to CoinMarketCap, at 11 a.m. on the same day, FTT was worth $2.18 (roughly 2,691 won), up 21.06% from the previous day. It increased by more than 30% at one point during the market and reached $2.54. (about 3136 won). Trading volume is also up 102.92% over the prior day.

FTT was once traded at roughly 25,000 won but dropped to 1 won following the FTX bankruptcy.

 

Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Crypto is not a legal tender and is subject to market risks. Readers are advised to seek expert advice and read offer document(s) along with related important literature on the subject carefully before making any kind of investment whatsoever. Crypto market predictions are speculative and any investment made shall be at the sole cost and risk of the readers.