FTX crypto exchange company filed for bankruptcy. After the platform confirmed this decision, CEO Sam Bankman-Fried suddenly resigned from his position.

(Photo : Photo by Craig Barritt/Getty Images for CARE For Special Children )
Sam Bankman-Fried speaks onstage during the first annual Moonlight Gala benefitting CARE - Children With Special Needs - hosted by Michael Cayre, Roy Nachum and MegaMoon Museum at Casa Cipriani on June 23, 2022 in New York City.

On Friday, Nov. 11, the digital coin trading company posted a tweet to announce its financial status, which is not a good one.

FTX explained Alameda Research Ltd., West Realm Shires Service Inc., and over 130 additional company affiliates started their voluntary proceedings under Chapter 11 of the U.S. Bankruptcy Code.

"The immediate relief of Chapter 11 is appropriate to provide the FTX Group the opportunity to assess its situation and develop a process to maximize recoveries for stakeholders," said the crypto exchange network.

FTX Crypto Exchange Bankrupted!

According to CNBC's latest report, the sudden bankruptcy left the CEO with no choice but to resign.

(Photo : Photo Illustration by Leon Neal/Getty Images)
In this photo illustration a notice warning against deposits, and that FTX is currently unable to process withdrawals, is displayed on a screen on November 10, 2022 in London, England. The Bahamas-based crypto exchange's larger rival, Binance.

Also Read: FTX Cuts Leverage Limit Down to 20x in an Effort to Curb High-Risk Trading

After stepping down, John J. Ray III replaced him as the company's new chief executive officer. Although Bankman-Fried is not the CEO anymore, he will assist the company with the transition.

As FTX went from a $32 billion valuation to bankruptcy, the crypto exchange platform's users are now worried.

They are demanding the company return their money. Aside from this issue, Binance also decided to cancel its nonbinding agreement to purchase FTX.

Before the bankruptcy happened, Sam already took responsibility for FTX's financial collapse, saying he "f***ed up."

Based on his statement, his resignation is not that surprising, especially since the company's liquidity has dried up.

Should Crypto Consumers Worry? 

If you look at the fall of FTX, the company's bankruptcy is not a big deal. 

Some crypto traders think that the digital coin trading platform's collapse wouldn't affect them. However, The New York Times reported that the downfall of FTX is now considered the crypto world's "Lehman moment," meaning it is anybody's problem now. 

This is because there are only two crypto exchange platforms in the market; FTX and Binance. 

If Binance is the main trading platform, there would definitely be some issues. One of the problems with Binance is that it has no official headquarters. 

You can visit this link for more details about why FTX's bankruptcy is a big deal. 

In other news, Binance allowed Iranian firms to process around $8 billion despite the sanctions imposed by the United States. 

Recently, Nubank's Nucoin launch in Brazil has been confirmed. 

For more news updates about FTX and other cryptocurrency companies, always keep your tabs open here at TechTimes.  

Related Article: FTX Update: Sam Bankman-Fried's Exchange Collapse Wipes Out His $16 Billion Wealth

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Written by Griffin Davis