[24] FTX began within Alameda Research, a trading firm founded by Bankman-Fried, Caroline Ellison, and other former employees of Jane Street in 2017, in Berkeley, California.

[41] Following the FTX bankruptcy, in December 2022, the US subsidiary of Binance won the bid to buy the assets of Voyager for approximately $1 billion.

[46] Bloomberg further stated that the regulatory oversight which applies to companies operating in traditional equities markets would have prohibited the relationship between the two firms were it applicable.

[48] Later, the existence of such an undisclosed beneficial relationship was described by Ray, the new CEO of FTX, as a "complete failure of corporate controls"[49] and indicated gross mismanagement.

[53] According to the sources cited by The Wall Street Journal, Ellison said the funds were used in part to pay back loans Alameda had taken to make investments.

[17] In the weeks immediately preceding the publication of the story by CoinDesk, Bankman-Fried was characterized by anonymous sources cited by Bloomberg as "desperately" attempting to raise money for FTX.

[55] Additionally, Bankman-Fried had been publicly "dueling" with Changpeng Zhao on Twitter in the months preceding the CoinDesk article, in part due to disagreements stemming from their differing views on the regulation of cryptocurrency.

[56] Several days after the publication of the CoinDesk article, on November 6, Binance CEO Changpeng Zhao said on Twitter that his firm intended to sell all its holdings of FTT.

[63] Zhao announced on Twitter that the company would complete due diligence soon, adding that all cryptocurrency exchanges should avoid using FTT tokens as collateral.

[62] Bankman-Fried said that although the firm's assets were worth more than its clients' deposits, it would need funds from outside to meet demand for withdrawals due to a lack of liquidity.

[53] According to the sources cited by The Wall Street Journal, Ellison said the funds were used in part to pay back loans Alameda had taken to make investments.

[52] Though Bankman-Fried, on November 10, wrote on Twitter that FTX's US customers did not have reason to worry, employees began attempting to sell assets belonging to the firm on the same day.

[83] On November 10, the team running the FTX Future Fund, an ostensibly charitable group bankrolled by Bankman-Fried, announced that they had resigned earlier that day.

[13] Bankman-Fried resigned as CEO and was replaced by John J. Ray III, a corporate restructuring specialist who'd previously overseen the liquidation of Enron.

[90] In January 2024, the U.S. Department of Justice indicted three individuals for running a SIM swap scam operation that allegedly stole “over $400 million in virtual currency” from an unspecified company.

[112] This halt caused Gemini, an exchange owned by the Winklevoss twins, to cease allowing redemptions for clients using a service provided through a partnership with Genesis.

[116][117] Institutional investors that stand to lose money due to their stakes in FTX include Tiger Global Management, the Ontario Teachers' Pension Plan, SoftBank Group, BlackRock, Lightspeed Venture Partners, Temasek, and Sequoia Capital.

[131] Anthony Scaramucci, founder of SkyBridge Capital, announced the firm was attempting to buy back a 30% stake in the business owned by FTX.

[137] A decline in the value of Cronos, the token of exchange Crypto.com, triggered fears of the potential for a collapse similar to that of FTX and spurred withdrawals from the platform.

[138] In December, it emerged that FTX had secretly invested in The Block, a cryptocurrency news firm, and to fund an LLC its CEO Michael McCaffrey used to buy an apartment.

[139] Investment manager and short selling specialist Jim Chanos predicted in November 2022 the collapse of FTX would lead to "increased scrutiny and regulation" over cryptocurrencies.

[144] Rostin Behnam, the Chairman of the Commodity Futures Trading Commission, called for Congress to grant the organization more power to regulate cryptocurrencies.

"[147] Technology analyst Avivah Litan commented on the cryptocurrency ecosystem that "everything...needs to improve dramatically in terms of user experience, controls, safety, [and] customer service.

[150][151] Anonymous sources cited by Bloomberg said that the office of the United States Attorney for the Southern District of New York had begun an investigation into FTX's collapse as of November 14, 2022.

[155] After being extradited from the Bahamas, Bankman-Fried was released on a $250 million bond and ordered to remain under house arrest at his parents' home in Palo Alto, California.

Judge Lewis A. Kaplan set the trial date for United States v. Bankman-Fried for October 2, 2023, saying he might move it "forward or backward a day or two."

Meanwhile, Gary Wang, co-founder of FTX, and Caroline Ellison, who had served as Alameda's CEO, pleaded guilty to multiple charges and began cooperating with federal prosecutors.

[156][157][158] Former FTX executive Ryan Salame pleaded guilty to both a campaign finance law violation and a charge of operating an unlicensed money transmitting business.

While Judge Kaplan acknowledged the assistance she’d provided to prosecutors, he said her cooperation should not be a “get out of jail free card.”[162] FTX's former engineering director, Nishad Singh pleaded guilty to six different charges, including three counts of conspiracy to commit fraud.

[164] On November 20, 2024, Gary Wang was sentenced to time served and three years of supervised release, with Kaplan saying Singh was “entitled to a lot of credit” for his cooperation with prosecutors.