FTX is inching closer to a potential reboot, with CEO John Ray reportedly opening up the floor to bidders looking to finance the new venture.
Bankrupt crypto exchange FTX is one step closer to relaunching as an entirely new exchange.
According to a June 28 report from The Wall Street Journal, FTX restructuring chief John Ray said the company had “begun the process of soliciting interested parties to the reboot of the FTX.com exchange.”
Sources familiar with the matter said the firm has been holding talks with investors around financing the potential reboot. Blockchain lending company Figure is among the parties who have displayed interest in the process.
Cointelegraph reached out to Figure but did not receive an immediate response.
Potential bidders reportedly have until the end of the week to lodge Letters of Intent — a document that outlines the terms and conditions of their participation.
Notably, the sources said that current FTX creditors would potentially be offered a stake in the reorganized crypto exchange, among other forms of compensation.
Importantly, "talks include possible compensation for certain existing customers, possibly by offering them stakes in any reorganized entity".
We expect customers to get recovery and/or equity tokens in FTX 2.0.
— FTX 2.0 Coalition (@AFTXcreditor) June 28, 2023
It’s expected that FTX will not be re-named “FTX 2.0” or any other derivative of its original name and will instead choose to rebrand as an entity with a different namesake.
Overall, it appears as though Ray and the rest of the team at FTX see a reboot as the best possible way of ensuring that creditors achieve the best outcome in terms of being repaid.
FTX’s legal team said in April they expect the launch of the new exchange to be completed sometime in the second quarter of 2024.
According to a June 26 report on the recovery process, FTX still has a near $2 billion hole in its books. The efforts to reclaim these missing funds have been further complicated by the alleged misuse of customer assets by key leadership at FTX.
Daniel Friedberg, a former regulatory officer at FTX who is understood to have appeared as an unnamed party in many of the legal proceedings, was sued by FTX on June 27 for allegedly paying “hush money” to silence potential whistleblowers as well as approving a series of fraudulent transfers and loans.
The report on the missing funds also detailed a series of alleged investments in venture capital firms, a $243 million Bahamian real estate portfolio as well as numerous donations to non-profit organizations.