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FTX execs identify $2.2 billion in recovered assets, Binance-Voyager deal awaits regulator approval

Yahoo Finance crypto reporter David Hollerith joins the Live show with the latest news from the cryptocurrency market.

Video transcript

DAVE BRIGGS: All right, crypto [? exchange's ?] [? FTX ?] new executives say they have found a $9 and 1/2 billion shortfall in crypto and cash needed to repay customers. To break it all down, we go live to Yahoo Finance reporter David Hollerith. Dave, what are we learning?

DAVID HOLLERITH: Dave, so yesterday in a press release FTX's interim CEO John J. Ray said it's taken a huge effort to get this far, and the exchange's assets are highly commingled. And that means that all these results as of now are still very much preliminary, meaning that they could change.


So FTX has a $9.5 billion shortfall in crypto and cash to repay customers and just $694 million-- excuse me, yes, $694 million in assets, and $2.2 billion have been recovered and are easily sellable, meaning liquid.

The group said it also lent $9.3 billion to Sam Bankman-Fried's Alameda Research, FTX being the entity there. And the shortfall for FTX.US, the US subsidiary, is smaller but still significant. It's $427 million against $335 million customer claims and [? $283 ?] third-party claims. So that's what we have as of now with FTX.

SEANA SMITH: All right, Dave, and you're also tracking the latest between the SEC objecting to the Binance proposal to buy Voyager. What are we learning at this point?

DAVID HOLLERITH: Yeah, so yesterday and today in a US bankruptcy court in New York, essentially the judge has been presiding over examining this plan for Voyager to sell customer accounts and its remaining crypto assets to Binance.US, Binance.US being a US cryptocurrency exchange that's affiliated with Binance international but a separate legal entity.

And that deal has become contentious. Federal and state regulators, as well as some Voyager customers-- or excuse me, creditors-- customers turned creditors have filed objections since, and they've shown up in the last two days to cross-examine some people advising Voyager on this deal.

Now today we also saw CZ, the CEO of Binance international-- again, as far as we know, not a part of this transaction-- take to Twitter essentially to sort of-- he made a joke about whether or not they should pull out of the deal but then went back to reiterate the support of Voyager-- or Binance US purchasing the assets. But the judge has been critical of both the SEC's argument not yet offering enough evidence for why the deal can't go through, and also regulators have been critical, including the SEC, of Voyager's advisors, asking them some sharp questions as to Binance.US's solvency.