Crypto prices sank on the news that FTX and more than 100 corporate entities affiliated with the firm are filing for bankruptcy.
Bitcoin dropped 5.2% at $16,551, while ether crashed 6.5% to $1,215.
Rumors of FTX's insolvency had been swirling in the lead-up to the filing. Former Head of Institutional Sales Zane Tacket revealed via Twitter that the firm had $8.8 billion in liabilities, just $900 million in liquid assets, and $5.2 billion in less liquid or illiquid assets.
The exchange was also seeking up to $9 billion in funding to plug its financial hole, according to a Reuters report.
Prices had been lifted by a positive U.S. inflation data report on Thursday. Crypto prices immediately jumped following the news, as did equities. Bitcoin traded at $16,420 before the release, jumping to $17,540 shortly after, according to data via Coinbase. These gains have now been erased.
Disclaimer: The former CEO and majority shareholder of The Block has disclosed a series of loans from former FTX and Alameda founder Sam Bankman-Fried.
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