Former FTX executives team up to launch new crypto exchange

As Sam Bankman-Fried, former CEO of collapsed crypto exchange FTX, awaits ruling in an ongoing trial, a group of former FTX executives, including one who served as a key witness against Bankman-Fried, are reportedly plan to launch a new cryptocurrency exchange.

Ex-FTX general counsel Can Sun and other former company executives aims to solve the problems that doomed their previous employer with the new cryptocurrency exchange, reports The Wall Street Journal.

Trek Labs, a Dubai-based startup led by Sun, has received a license from the UAE’s crypto regulator.

The crypto venture is aiming to sell a 10 per cent stake to investors at a valuation of over $100 million, the report mentioned.

Ex-FTX employee Armani Ferrante is chief executive of Trek’s holding company in the British Virgin Islands. Sun’s former legal deputy, who is also Ferrante’s wife, is on Trek’s executive team.

“In a post-FTX world, you need trust and transparency to create a true alternative to the other players,” Sun was quoted as saying. They have hired other former FTX legal and compliance employees at Trek.

“Backpack Exchange, the name under which Trek Labs will do business, will use Backpack’s technology to allow users to hold funds in their own ‘self-custody crypto wallets that the exchange itself wouldn’t be able to unilaterally access,” according to the Trek team.

Meanwhile, Bankman-Fried was found guilty on all seven counts related to fraud and money laundering earlier this month.

The US Attorney’s office at the Southern District of New York said in a statement that Bankman-Fried perpetrated one of the biggest financial frauds in American history — a multibillion-dollar scheme designed to make him the ‘King of Crypto’.

A New York jury found Bankman-Fried (31) guilty of two counts of wire fraud conspiracy, two counts of wire fraud, and one count of conspiracy to commit money laundering, each of which carries a maximum sentence of 20 years in prison.

He was also convicted of conspiracy to commit commodities fraud and conspiracy to commit securities fraud, each of which carries a maximum sentence of five years in prison. Bankman-Fried is set to be sentenced by Judge Lewis Kaplan on March 28 next year and faces decades in prison.