In recent days, the cryptocurrency market has been seriously feverish, Bitcoin fell by more than 15% on average in 7 days, and Ethereum by more than 19%, the reason for which was, among other things, the events surrounding the cryptocurrency exchange FTX. The latter faced the problem of liquidity, not counting the $8 billion of funds needed to continue operations.

The reason for this was that FTX used $10 billion of customer funds to support its owner Sam Bankman-Fried’s trading firm Alameda Research after taking out loans funded by FTX customer deposits, reports The Wall Street Journal.

As noted by economist Frances Coppola, exchanges like FTX should not be investing customers’ money.

“It shouldn’t be doing anything with those assets. They should literally be sitting there so people can use them,” Coppola said. This is especially true in volatile markets such as cryptocurrency, where the collateral can change in price from day to day.

However, FTX reportedly lent more than half of its clients’ funds to Alameda, which then used them to bet on other cryptocurrencies and help other crypto firms struggling to survive the general market downturn.

FTX’s troubles began with a CoinDesk article that questioned Alameda’s balance sheet, saying that most of it consisted of FTT, the exchange’s own token. This turned into a real problem when Binance founder Changpeng Zhao announced plans to sell the billions of FTT he owned, leading to an irreversible drop in the value of the cryptocurrency.

Since then, FTX has been struggling to stay afloat and its customers have been scrambling to withdraw funds amid concerns about such a risky financial deal between FTX and Alameda. Data trackers such as Nansen have recorded several successful withdrawals processed by FTX in Thursday, but who was able to withdraw the funds and why is still unclear.

Both Alameda and FTX are controlled by Sam Bankman-Fried, who managed to publicly apologize, saying he “screwed up and should have done better.” However, he did not directly answer whether Alameda used funds from FTX clients.

The future of FTX is up in the air at this point, although things are not looking good. The largest cryptocurrency exchange, Binance, announced earlier this week that it intends to buy the firm in order to guarantee customers the return of their funds. But the very next day, it withdrew the offer, saying its comprehensive review had identified “issues beyond our control or ability to assist.”

As reported, Bankman-Fried is currently trying to raise $9.4 billion from various investors for an FTX rescue package. He tweeted that “every penny” of the raised liquidity would go to clients until the firm “does it right.”

Benkman-Fried also stated that users of are fine (the domestic exchange for the US market operates as a separate entity) and that whatever is happening concerns the international exchange However, has already issued a warning that “trading on FTX US may be suspended in a few days” and a request to investors to “close any positions you wish to close.” It also says that “withdrawals are and will remain open.”

According to Bloomberg, employees of FTX US are trying to sell off some of the company’s assets. That includes the naming rights to the stadium in Miami, the home arena of the Miami Heat, and the clearing firm it acquired earlier this year. The message emphasizes that Bankman-Fried does not necessarily participate in all discussions.