FTX Trading is examining restarting the crypto exchange with three bidders, according to a Bloomberg report Tuesday. This comes nearly one year after the company filed for bankruptcy, and as founder Sam Bankman-Fried sits on trial for alleged fraud.
The company’s investment banker Kevin M. Cofsky says FTX is negotiating details of potentially binding offers with investors, and will make a decision about how to proceed by mid-December, the report says. That decision date is just a month after final testimonies will be given in SBF’s trial, alleging billions in fraud committed while he was at FTX. Bankman-Fried resigned as Chief Executive Officer shortly after the company shut down last year.
Before November 2022, FTX was one of the world’s biggest crypto exchanges, with more than 9 million customers. The negotiations include discussions around selling the entire exchange or bringing in a partner to help restart the exchange in-house, according to the Bloomberg report.
FTX is also allegedly considering a reboot of the trading platform all on its own. Currently, the company has been busy trying to repay creditors from its bankruptcy filing. So far, $7 billion in assets have been recovered, including $3.4 billion of crypto. However, customers don’t know how much they will actually get back. FTX’s customers may get a higher percentage of their money back if the exchange is able to negotiate a decent sale or a successful reboot. Details of the current deal negotiations were announced in a Delaware court hearing on Tuesday.
The success of the platform became a measuring stick for cryptocurrency’s popularity. However, details of the fraud that have come to light in Sam Bankman-Fried’s trial put into question just how successful the platform truly was. Another leading crypto exchange, Binance, is currently fighting a handful of lawsuits from US regulators.
The negotiations come at a particularly optimistic time in the crypto universe, as the price of Bitcoin hovers around prices not seen since the crash of FTX; nearing $35,000. That optimism is spurred by speculation that Bitcoin ETFs will soon make their way onto the market, allowing large financial institutions to tap into crypto’s gains. The hope is that this would create a safer way for more people to invest in crypto, allowed for by the structure of ETFs. This move could open the floodgates on tons of capital into the crypto market, and it looks like FTX doesn’t want to rule themselves out of those gains just yet.
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