FTX, a cryptocurrency exchange, has recently announced a significant shortfall in its digital asset and fiat currency holdings, with billions worth of customer funds missing from both FTX and its US-based arm, FTX US.
In a presentation released on March 2, FTX revealed that it had $2.2 billion in exchange wallets and fiat accounts, out of which $694 million were Category A Assets, including cash, stablecoins, Bitcoin, and Ether.
Only $191 million of total assets were located in the wallets of the accounts associated with FTX US. FTX wallets also showed a $9.3 billion net borrowing by its sister trading firm, Alameda Research, and a $107 million net payable to Alameda from FTX US.
Meanwhile, FTX recorded surpluses across its less liquid Category B Assets, including its own FTX Token (FTT), but the holdings were insignificant compared to the deficits on its other held assets.
The total deficit across all wallets and accounts for FTX was $8.6 billion, while FTX US recorded a deficit of $116 million. John J. Ray III, the chief restructuring officer and CEO of FTX, said in a statement on March 2 that this presentation is the second in a series as FTX continues to uncover the facts of the situation.
He added that the exchange’s assets were highly commingled, and their books and records are incomplete and, in many cases, totally absent.
This news follows the guilty plea of former FTX engineering director Nishad Singh on charges of wire fraud, wire fraud conspiracy, and commodities fraud conspiracy on February 28. As FTX continues to investigate this situation, customers are advised to take appropriate measures to secure their assets and monitor the developments closely.