FTX’s new management, led by CEO John J. Ray III, is considering a rebirth of Sam Bankman-Fried’s defunct crypto exchange, according to the latest legal billings.
The new CEO reportedly spent several hours last month examining and working on what seems to be FTX 2.0 materials.
FTX 2.0: Latest Court Filings Hint There Is Work Underway To Reboot Collapsed Crypto Giant
The FTX crypto enterprise filed for bankruptcy last November, shocking the global crypto markets, with its founder and former CEO Sam Bankman-Fried facing fraud charges in the United States.
Now, the struggling crypto exchange is considering reopening at some point in the future.
The monthly staffing report and compensation details for the new CEO of FTX, John J. Ray III, shows that during this time, he engaged in a series of activities that might enable the reboot of the cryptocurrency trading platform.
Ray first floated the idea of restarting FTX in January this year. “Everything is on the table. If there is a path forward on that, then we will not only explore that, we’ll do it,” Ray posited. At the time, there were reports that the failed exchange had uncovered and retrieved $5.5 billion in liquid assets and that Ray was working with creditors on a potential revival plan. Then last month, another report said FTX had recovered $7.3 billion in assets and was thus considering reviving its crypto exchange operations sometime in the second quarter of next year.
The new court documents indicate that a reboot plan is indeed in the works. In the “Summary of Time and Fees by Professional”, Ray charged $1,040 for less than an hour of work to “Review and finalize 2.0 reboot of exchange material for distribution” to investors. These included seeking help from cybersecurity firm Sygnia to improve the security of the crypto exchange, as well as analyzing a term sheet for restructuring the company as part of the plan.
Fresh Capital Injection Needed
In April, FTX’s lead attorney Andy Dietderich also advocated for an FTX reboot. According to Dietderich, restarting the exchange would require substantial capital, regardless of whether it would offer services to only U.S.-based customers or operate internationally.
The latest court filings suggest FTX will likely be entering a bidding process.
San Francisco-based VC firm Tribe Capital, which was an investor in the exchange before it went under, is allegedly considering leading a fund-raising campaign to jump-start revival efforts. Per Bloomberg, the rebooted exchange would keep the FTX name.
Members of the crypto community have touted the relaunch plan as an opportunity for over a million FTX creditors to be made whole. For one creditor DegenSpartan, FTX 2.0 “is the most likely path to maximum recovery”.
FTX’s native token, FTT, surged 12.8% on Monday following the news of a potential reboot of the collapsed crypto empire of SBF. At press time, FTT is trading at $1.13, according to CoinGecko. The bankrupt exchange’s token was down 98.68% from its $84.18 all-time high set back in September 2021.