FTX logo with crypto coins with 100 Dollar bill are displayed for illustration. FTX has filed for bankruptcy in the US, seeking court protection as it looks for a way to return money to users.
Jonathan Raa | Nurphoto | Getty Images
Beleaguered cryptocurrency exchange FTX may have more than 1 million creditors, according to a new bankruptcy filing, hinting at the huge impact of its collapse on crypto traders.
Last week, when it filed for Chapter 11 bankruptcy protection, FTX indicated that it had more than 100,000 creditors with claims in the case.
But in an updated filing Tuesday, lawyers for the company said: “In fact, there could be more than one million creditors in these Chapter 11 Cases.”
Typically in such cases, debtors are required to provide a list of the names and addresses of the top 20 unsecured creditors, the lawyers said. However, given the scale of its debts, the group instead intends to file a list of the 50 largest creditors on or before Friday.
Five new independent directors have been appointed at each of FTX’s main parent companies, according to the filing, including the former Delaware district judge, Joseph J. Farnan, who will serve as lead independent director.
Over the past 72 hours, FTX has been in contact with “dozens” of regulators in the U.S. and overseas, the company’s lawyers wrote. These include the U.S. Attorney’s Office, the Securities and Exchange Commission and the Commodity Futures Trading Commission.
This year has seen a spate of crypto firms, including Celsius and Voyager Digital, fail as they contend with a slump in digital asset prices and ensuing liquidity issues.
In earlier bankruptcy cases, traders on these platforms have been designated “unsecured creditors,” meaning they’ll likely be at the back of a long queue of entities seeking repayment, from suppliers to employees.
Before its collapse, FTX offered amateur and professional traders spot crypto investing as well as more complex derivatives trades. At its peak, the platform was valued by investors at $32 billion and had more than 1 million users. The company’s failure has had a chilling effect on the industry, with investors selling their positions and moving funds off exchanges.
On Monday, the CEOs of Binance and Crypto.com sought to reassure investors about their businesses’ financial health. Binance’s Changpeng Zhao said his exchange had only seen a minor increase in withdrawals, while Crypto.com chief Kris Marszalek said his firm had a “tremendously strong balance sheet.”
Commingling of client funds
FTX entered bankruptcy Friday as concerns over its financial health led to a surge in withdrawals and a plunge in the value of its native FTT token. Sam Bankman-Fried, FTX’s founder, stepped aside as CEO and was replaced by John J. Ray III.
FTX initially turned to Binance for a rescue deal, but this fell apart when Binance backed out citing reports of mishandled customer funds and alleged U.S. government probes into FTX. Over the weekend, FTX was hit with an apparent cyberattack resulting in the theft of more than $400 million worth of tokens.
“FTX faced a severe liquidity crisis that necessitated the filing of these cases on an emergency basis last Friday,” lawyers wrote in the filing Tuesday. “Questions arose about Mr. Bankman-Fried’s leadership and the handling of FTX’s complex array of assets and businesses under his direction.”
CNBC reported Sunday that Alameda Research, FTX’s sister company, had borrowed billions in customer funds from the exchange to ensure it had enough liquidity on hand to process withdrawals.
In general, mixing customer funds with counterparties and trading them without explicit consent is illegal, according to U.S. securities law. It also violates FTX’s terms of service.
Bankman-Fried declined to comment on allegations but said the company’s recent bankruptcy filing was the result of issues with a leveraged trading position.
“I think it’s increasingly clear, even at a basic level, that this kind of intermingling of interests between the market maker and the exchange is highly unethical,” Jamie Burke CEO and founder of Web3-focused venture capital firm Outlier Ventures, told CNBC.
In a cryptic Twitter thread this week, Bankman-Fried wrote the word “What” followed by the letters “H,” “A,” “P,” “P,” “E,” “N,” “E,” “D,” in intermittent tweets.
He finished the thread Tuesday with the sentence: “10) [NOT LEGAL ADVICE. NOT FINANCIAL ADVICE. THIS IS ALL AS I REMEMBER IT, BUT MY MEMORY MIGHT BE FAULTY IN PARTS.]”
Tik Tok creators gather before a press conference to voice their opposition to the “Protecting Americans from Foreign Adversary Controlled Applications Act,” pending crackdown legislation on TikTok in the House of Representatives, on Capitol Hill in Washington, U.S., March 12, 2024.
Craig Hudson | Reuters
The Supreme Court on Friday will hear oral arguments in the case involving the future of TikTok in the U.S., which could ban the popular app as soon as next week.
The justices will consider whether the Protecting Americans from Foreign Adversary Controlled Applications Act, the law that targets TikTok’s ban and imposes harsh civil penalties for app “entities” that continue to carry the service after Jan.19, violates the U.S. Constitution’s free speech protections.
It’s unclear when the court will hand down a decision, and if China’s ByteDance continues to refuse to divest TikTok to an American company, it faces a complete ban nationwide.
What will change about the user experience?
The roughly 115 million U.S. TikTok monthly active users could face a range of scenarios depending on when the Supreme Court hands down a decision.
If no word comes before the law takes effect on Jan. 19 and the ban goes through, it’s possible that users would still be able to post or engage with the app if they already have it downloaded. However, those users would likely be unable to update or redownload the app after that date, multiple legal experts said.
Thousands of short-form video creators who generate income from TikTok through ad revenue, paid partnerships, merchandise and more will likely need to transition their businesses to other platforms, like YouTube or Instagram.
“Shutting down TikTok, even for a single day, would be a big deal, not just for people who create content on TikTok, but everyone who shares or views content,” said George Wang, a staff attorney at the Knight First Amendment Institute who helped write the institute’s amicus briefs on the case.
“It sets a really dangerous precedent for how we regulate speech online,” Wang said.
Who supports and opposes the ban?
Dozens of high-profile amicus briefs from organizations, members of Congress and President-elect Donald Trump were filed supporting both the government and ByteDance.
The government, led by Attorney General Merrick Garland, alleges that until ByteDance divests TikTok, the app remains a “powerful tool for espionage” and a “potent weapon for covert influence operations.”
Trump’s brief did not voice support for either side, but it did ask the court to oppose banning the platform and allow him to find a political resolution that allows the service to continue while addressing national security concerns.
The short-form video app played a notable role in both Trump and Democratic nominee Kamala Harris’ presidential campaigns in 2024, and it’s one of the most common news sources for younger voters.
In a September Truth Social post, Trump wrote in all caps Americans who want to save TikTok should vote for him. The post was quoted in his amicus brief.
What comes next?
It’s unclear when the Supreme Court will issue its ruling, but the case’s expedited hearing has some predicting that the court could issue a quick ruling.
The case will have “enormous implications” since TikTok’s user base in the U.S. is so large, said Erwin Chemerinsky, dean of Berkeley Law.
“It’s unprecedented for the government to prohibit platforms for speech, especially one so many people use,” Chemerinsky said. “Ultimately, this is a tension between free speech issues on the one hand and claims of national security on the other.”
Nvidia CEO Jensen Huang speaks about Project Digits personal AI supercomputer for researchers and students during a keynote address at the Consumer Electronics Show (CES) in Las Vegas, Nevada on January 6, 2025. Gadgets, robots and vehicles imbued with artificial intelligence will once again vie for attention at the Consumer Electronics Show, as vendors behind the scenes will seek ways to deal with tariffs threatened by US President-elect Donald Trump. The annual Consumer Electronics Show (CES) opens formally in Las Vegas on January 7, 2025, but preceding days are packed with product announcements. (Photo by Patrick T. Fallon / AFP) (Photo by PATRICK T. FALLON/AFP via Getty Images)
Patrick T. Fallon | Afp | Getty Images
Nvidia CEO Jensen Huang was greeted as a rock star this week CES in Las Vegas, following an artificial intelligence boom that’s made the chipmaker the second most-valuable company in the world.
At his nearly two-hour keynote on Monday kicking off the annual conference, Huang packed a 12,000-seat arena, drawing comparisons to the way Steve Jobs would reveal products at Apple events.
Huang concluded with an Apple-like trick: a surprise product reveal. He presented one of Nvidia’s server racks and, using some stage magic, held up a much smaller version, which looked like a tiny cube of a computer.
“This is an AI supercomputer,” Huang said, while donning an alligator skin leather jacket. “It runs the entire Nvidia AI stack. All of Nvidia’s software runs on this.”
Huang said the computer is called Project Digits and runs off a relative of the Grace Blackwell graphics processing units (GPUs) that are currently powering the most advanced AI server clusters. The GPU is paired with an ARM-based Grace central processing unit (CPU). Nvidia worked with Chinese semiconductor company MediaTek to create the system-on-a chip called GB10.
Formerly known as the Consumer Electronics Show, CES is typically the spot to launch flashy and futuristic consumer gadgets. At this year’s show, which started on Tuesday and wraps up on Friday, several companies announced AI integrations with appliances, laptops and even grills. Other major announcements included a laptop from Lenovo which has a rollable screen that can expand vertically. There were also new robots, including a Roomba competitor with a robotic arm.
Unlike Nvidia’s traditional GPUs for gaming, Project Digits isn’t targeting consumers. instead, it’s aimed at machine learning researchers, smaller companies, and universities that want to developed advanced AI but don’t have the billions of dollars to build massive data centers or buy enough cloud credits.
“There’s a gaping hole for data scientists and ML researchers and who are actively working, who are actively building something,” Huang said. “Maybe you don’t need a giant cluster. You’re just developing the early versions of the model, and you’re iterating constantly. You could do it in the cloud, but it just costs a lot more money.”
The supercomputer will cost about $3,000 when it becomes available in May, Nvidia said, and will be available from the company itself as well as some of its manufacturing partners. Huang said Project Digits is a placeholder name, indicating it may change by the time the computer goes on sale.
“If you have a good name for it, reach out to us,” Huang said.
Diversifying its business
It’s a dramatically different kind of product from the GPUs that have driven Nvidia’s historic boom in the past two years. OpenAI, which launched ChatGPT in late 2022, and other AI model creators like Anthropic have joined with large cloud providers in snapping up Nvidia’s data center GPUs because of their ability to power the most intensive models and computing workloads.
Data center sales accounted for 88% of Nvidia’s $35 billion in revenue in the most recent quarter.
Wall Street is focused on Nvidia’s ability to diversify its business so that it’s less reliant on a handful of customers buying massive AI systems.
The Nvidia Project Digits supercomputer during the 2025 CES event in Las Vegas, Nevada, US, on Wednesday, Jan. 8, 2025.
Bridget Bennett | Bloomberg | Getty Images
“It was a little scary to see Nvidia come out with something so good for so little in price,” Melius Research analyst Ben Reitzes wrote in a note this week. He said Nvidia may have “stolen the show,” due to Project Digits as well other announcements including graphics cards for gaming, new robot chips and a deal with Toyota.
Project Digits, which runs Linux and the same Nvidia software used on the company’s GPU server clusters, represents a huge increase in capabilities for researchers and universities, said David Bader, director of the Institute for Data Science at New Jersey Institute of Technology.
Bader, who has worked on research projects with Nvidia in the past, said the computer appears to be able to handle enough data and information to train the biggest and most cutting-edge models. He told CNBC Anthropic, Google, Amazon and others “would pay $100 million to build a super computer for training” to get a system with these sorts of capabilities.
For $3,000, users can soon get a product they can plug into a standard electrical outlet in their home or office, Bader said. It’s particularly exciting for academics, who have often left for private industry in order to access bigger and more powerful computers, he said.
“Any student who is able to have one of these systems that cost roughly the same as a high-end laptop or gaming laptop, they’ll be able to do the same research and build the same models,” Bader said.
Reitzes said the computer may be Nvidia’s first move into the $50 billion market for PC and laptop chips.
“It’s not too hard to imagine it would be easy to just do it all themselves and allow the system to run Windows someday,” Reitzes wrote. “But I guess they don’t want to step on too many toes.”
Huang didn’t rule out that possibility when asked about it by Wall Street analysts on Tuesday.
He said that MediaTek may be able to sell the GB10 chip to other computer makers in the market. He made sure to leave some mystery in the air.
Alice Weidel, co-leader of the far-right Alternative for Germany (AfD) political party, arrives to speak to the media with AfD co-leader Tino Chrupalla shortly after the AfD leadership confirmed Weidel as the party’s candidate for chancellor on December 07, 2024 in Berlin, Germany.
Maryam Majd | Getty Images
Elon Musk used his social network X to promote Germany’s far-right Alternative for Germany party, known as AfD, hosting a live discussion Thursday with party leader Alice Weidel, a candidate for chancellor, ahead of a general election on Feb. 23.
“I’m really strongly recommending that people vote for AfD,” Musk, who is CEO of Tesla and SpaceX in addition to his role at X, said about a half hour into the conversation. “That’s my strong recommendation.”
The AfD has been classified as a “suspected extremist organization” by German domestic intelligence services. The party’s platform calls for rigid asylum laws, mass deportations, cuts to social and welfare support in Germany, and the reversal of restrictions on combustion engine vehicles.
Thierry Breton, former European Union commissioner for the internal market, said in a Jan. 4 post on X directed at Weidel: “As a European citizen concerned with the proper use of systemic platforms authorized to operate in the EU … especially to protect our democratic rules against illegal or misbehavior during election times, I believe it’s crucial to remind you” that a live discussion on X would give AfD and Weidel “a significant and valuable advantage over your competitors.”
While AfD has amassed about 20% of public support, according to reporting from broadcaster DW, the party is unlikely to form part of a coalition government, as most other parties have vowed not to work with it.
AfD previously protested the build-out of Tesla’s electric vehicle factory outside Berlin, in part because the factory would provide jobs to people who were not German citizens.
Musk’s earlier endorsements of AfD, including tweets complimenting the party and an editorial in a German newspaper, have enraged European government officials. Musk, the wealthiest person in the world, has also endorsed far-right and anti-establishment candidates and causes in the U.K.
Political leaders in France, Germany, Norway and the U.K. denounced his influence, NBC News previously reported, warning that Musk should not involve himself in their countries’ elections.
Musk, who was one of President-elect Donald Trump’s top backers in November’s election, previously promoted Trump in a live-streamed discussion on X. Before that, he hosted a conversation with Florida Gov. Ron DeSantis, who lost to Trump in the Republican primary.
Weidel during Thursday’s talk asked Musk about what Trump might do to bring Russia’s war in Ukraine to a conclusion, as the president-elect has suggested he could quickly do.
Musk demurred.
“To be clear this is up to President Trump, he is commander and chief, so it’s really up to him,” Musk said. “I don’t want to speak for him but you know I do think that there is a path to a resolution but it does require strong leadership in the United States to get this done.”
Musk also weighed in on what he thought should be done in Gaza, which has been under attack from Israel since Hamas’ deadly incursion into Israel on Oct. 7, 2023.
“There’s no choice but to eliminate those who wish to eliminate the state of Israel, you know Hamas essentially,” Musk said. “Then, the second step is to fix the education so that Palestinians are not trained from when they are children to hate and want the death of Israel.”
“Then, the third thing, which is also very important, is to make the Palestinian areas prosperous.”