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Federal Prosecutors in Manhattan are Investigating the FTX Collapse

Large Creditors are Owed $3.1 Billion by the Crypto Exchange FTX

According to reports Federal prosecutors in Manhattan are looking into the shocking collapse of the crypto network FTX. The US Attorney’s Office for the Southern District of New York is investigating the circumstances behind FTX’s downfall.

The abrupt collapse of FTX, which had $9 billion in obligations and just $900 million in assets, drove the cryptocurrency market into a tailspin last week. On Friday, the platform and FTX subsidiaries trading company Alameda Research and FTX.us filed for bankruptcy.

A source familiar with the situation said that FTX co-founder Sam Bankman-Fried was also interrogated by Bahamian police and regulators on Saturday. Authorities in the nation are trying to examine if there was any criminal involvement in FTX’s collapse. The company is incorporated in the Bahamas.

A request for comment from FTX’s US general counsel was not immediately returned. The federal investigation in Manhattan came after US SEC said last week that it was also looking into the platform.

FTX and its affiliates filed for Chapter 11 bankruptcy protection last week. Bankman-Fried resigned as CEO after the cryptocurrency exchange failed to seek a rescue due to a liquidity crisis.

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