FTX resumes payments to employees as BlockFi files for bankruptcy

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After filing for chapter 11 bankruptcy in November, FTX exchange has resumed payments to its employees and key vendors, per a recent press statement.

The relief includes cash payments made during both the pre-petition and post-petition periods, subject to the bankruptcy court's rules.

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In other news, BlockFi and Silvergate have also been affected by FTX's recent collapse.

FTX resumes payments to vendors and employees

According to a recent statement by FTX, the bankrupt cryptocurrency exchange has announced that it has resumed payments to some employees after filing for bankruptcy in November 2022.

At a hearing for FTX last week, the bankruptcy court approved the first-day motions for the exchange, permitting FTX to pay wages to its key vendors and employees.

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From the statement:

With the Court's approval of our First Day motions and the work being done on global cash management, I am pleased that the FTX group is resuming ordinary course cash payments of salaries and benefits to our remaining employees around the world.

However, the relief is only limited to employees, contractors, and debtors of the exchange in the Bahamas and not to employees of FTX Digital Markets Limited, also referred to as FTXDM.

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The statement further outlines that the relief also does not apply to employees or contractors of FTX Australia PTY Limited and FTX Express PTY Limited, citing that they are "the subject of a separate proceeding in Australia and not included in, or protected by, the chapter 11 cases in the United States."

Crypto chaos spreads to BlockFi and Silvergate

Crypto lender BlockFi announced its bankruptcy on November 28 after being exposed to FTX-Alameda.

Soon after the announcement, Silvergate Capital Corporation, a leading digital assets bank providing financial infrastructure solutions to companies, announced its "minimal exposure to BlockFi."

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Silvergate further shared how the company's deposit relationship with BlockFi is less than $20 million and has reassured its users that its support team is ready to assist users "24 hours a day."

According to Silvergate's CEO, Alan Lane:

As the digital asset industry continues to transform, I want to reiterate that Silvergate's platform was purpose-built to manage stress and volatility.

Get the latest news on Bitcoin, Ethereum, Shiba Inu, and Cardano.