Major cryptocurrency broker Hidden Road Partners is expected to complete the liquidation of its FTX.com holdings tonight, according to Bloomberg.

Hidden Road Partners, founded by Marc Asch in 2018, is a major brokerage firm focused on digital assets and forex trading. The company allows banks or other institutions that cannot directly own digital assets to realize profits and losses in US dollars by using US dollars as collateral through a “three-way” mechanism established with custodians.

Hidden Road Partners urges users currently on the FTX.com virtual currency exchange to liquidate their current positions and exchange all balances for fiat US dollars due to the latest liquidity crisis on the FTX exchange.

The company claims to have decided to liquidate the FTX.com holdings due to “exchange default”. Earlier in August, digital asset and forex brokerage firm Hidden Road Partners completed a $50 million financing, with participation from Citadel Securities, FTX Ventures, Coinbase Ventures, and others.

Just a few days ago, Binance founder and CEO Changpeng Zhao previously announced that the exchange intended to liquidate all of its FTX exposure of approximately $530 million worth of FTT tokens as part of Binance’s exit from FTX’s holding. last year.

The decisions triggered a FUD sentiment in the market, causing FTX to collapse.

FTX CEO Sam Bankman-Fried has reportedly informed investors that the crypto exchange will need to file for bankruptcy if it cannot secure an injection of cash. Bloomberg got the news from a person with direct knowledge of the matter.

The liquidity crisis caused by the highly leveraged use of funds by cryptocurrency exchange FTX.com has caused the entire industry to think about a number of issues, such as the safety, custody, and transparency of funds.

Bybit co-founder and CEO Ben Zhou said “the entire industry has a duty and obligation to do better for our customers.”

Many other crypto exchanges, including Coinbase, Bybit, have stated that they will not engage in high-risk activities and will ensure that all customer assets are stored in one-to-one liquidity escrow, and users can withdraw assets at any time. .

Crypto.com CEO Kris Marszalek also stated that crypto platforms should be required to share proof of reserves publicly, and Crypto.com will publish our audited proof of reserves.

“This is a critical time for the entire industry. Transparency is more important than ever, and the security of users and funds remains the priority. It requires a total and collective commitment.” Marszalek said.

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