FTX Warns Of Trade Of Fake “Debt Coins” On Exchanges

Key Points:

• The restructuring team in charge of the FTX bankruptcy today issued a warning to investors, cautioning them to watch out for fraudulent tokens that seek to profit on the difficulties facing the defunct cryptocurrency exchange.
• FTX was fraudulently mishandled, and since billions of dollars have vanished, it is now unknown whether or not former clients will ever again be able to access the money they had on the exchange.
• Houbi, a Seychelles-based company led by Tron creator Justin Sun, reduced its workforce by 20% earlier this year, joining companies like Coinbase, Crypto.com, and Kraken in drastic personnel reductions in the midst of a harsh bear market.

The restructuring team in charge of the FTX bankruptcy today issued a warning to investors, cautioning them to watch out for fraudulent tokens that seek to profit on the difficulties facing the defunct cryptocurrency exchange.

The business tweeted, “The FTX Debtors advise stakeholders to be on guard for scams from entities purporting to be linked with FTX.” “Any such offerings are unauthorized,” the statement reads. “The FTX Debtors have not issued any debt token.”

In this context, “debtors” generally refers to the firm itself, whereas “creditors” are the people or organizations that the company owes money to (like its customers).

Although FTX did not specifically name a token, it is most likely referring to a brand-new coin dubbed “FTX Users’ Debt,” or FUD, which was listed on Justin Sun’s Huobi market as of February 7.

On the day of its launch, the token reached a high of $80.13, however trading on it only saw a 24-hour volume of about $1.8 million. Since then, the price of FUD has fallen precipitously, and it is now only worth $15.73, according to data from CoinMarketCap. Only two stablecoins, Tether (USDT) and USDD, are available for trading using the token, and only on Huobi. According to CoinMarketCap, its trading volume for the previous day was less than $250,000.

FTX declared bankruptcy

On November 11, FTX declared bankruptcy, and Sam Bankman-Fried, the company’s founder, gave up his position as CEO. As a bank run on the platform depleted liquidity and forced the company to acknowledge it did not have one-to-one reserves of customer assets, the exchange collapsed. In connection with the demise of FTX, Bankman-Fried has since been detained and charged with eight financial offenses.

Officials claim that FTX was fraudulently mishandled, and since billions of dollars have vanished, it is now unknown whether or not former clients will ever again be able to access the money they had on the exchange. Scam tools like FUD might now be stealing even more money from these clients, adding insult to injury.

Houbi, a Seychelles-based company led by Tron creator Justin Sun, reduced its workforce by 20% earlier this year, joining companies like Coinbase, Crypto.com, and Kraken in drastic personnel reductions in the midst of a harsh bear market.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your research before investing.

Join us to keep track of news: https://linktr.ee/coincu

Website: coincu.com

Annie

Coincu News