When a company enters administration, management hands over control to licensed insolvency practitioners, who independently assess its financial situation. The administrators' options include restructuring, liquidation of assets, distributing proceeds or recovery of value on behalf of stakeholders.
Read More: The Collapse of the FTX Empire
Bankman-Fried is one of the three directors of FTX Australia. The local directors put the operations in the hands of administrators from KordaMentha, who have begun examining the crypto exchange's books to see whether there are enough assets to pay back local customers.
The collapse of the FTX empire was triggered by a CoinDesk report on the firm's relationship with its trading partner Alameda and the subsequent withdrawal of Binance from a mooted takeover.
UPDATE (Nov. 11, 09:35 UTC): Adds description of administration in second paragraph.
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