Bloomberg and WSJ report an $8 billion hole in FTX balance sheet

The founder and CEO of FTX, Sam Bankman-Fried, told investors that without additional capital the exchange would be forced to declare bankruptcy. Bloomberg reports.

According to the agency’s source, during the conference call Bankman-Fried said that, due to a liquidity crisis, the company faced a shortfall of up to $8 billion. FTX needs $4 billion to remain solvent, the exchange’s founder said.

In The Wall Street Journal they quoted similar estimates. Sources to the publication confirmed that the platform needs cash injections to meet clients’ withdrawal requests.

According to Bloomberg, FTX is seeking emergency financing in the form of debt, equity, or a combination.

The analyst going by the pseudonym Cobie published a message that the head of the company allegedly sent to employees on Slack. The screenshot also indicates the company’s plans to raise financing to address the problem.

A msg from SBF on FTX slack that got leaked to me by some telegram anon, have verified its real w another pic.twitter.com/XMjIM9nSkx

— Cobie (@cobie) November 10, 2022

“As part of the forthcoming fundraising, we spoke with Justin Sun,” the message says.

Earlier Sun stated that, together with FTX, he is developing a solution that will allow the company to start moving forward. He did not specify what exactly the initiative was about.

Against the backdrop of FTX’s financial problems, U.S. regulators have begun examining the company’s ties with its U.S. subsidiary and Alameda Research. The Department of Justice has also taken an interest in the platform’s activities.

Recall that one of FTX’s investors, venture firm Sequoia Capital, has deemed unrecoverable investments in the exchange amounting to $213.5 million.

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