FTX Group announced in a statement that it filed for Chapter 11 bankruptcy proceedings, adding it has begun an “orderly process to review and monetize assets for the benefit of all global stakeholders.”

Chapter 11 is a US mechanism allowing a company to restructure its debts under court supervision while continuing to operate.

It comes at the end of a week in which major cryptocurrencies, including bitcoin, have plunged owing to financial chaos at FTX.

The cash-strapped company added that it has appointed John J. Ray as chief executive to replace Bankman-Fried with immediate effect.

“The immediate relief of Chapter 11 is appropriate to provide the FTX Group the opportunity to assess its situation,” said Ray in the statement.

“Stakeholders should understand that events have been fast-moving and the new team is engaged only recently.”

Digital currencies were slammed this week after the biggest cryptocurrency platform Binance agreed to buy troubled rival FTX.com on Tuesday – before scrapping the takeover just one day later.

FTX was plunged into turmoil earlier this month on liquidity fears in a spectacular reversal of fortune for its founder and one-time cryptocurrency wunderkind Bankman-Fried.

Doubts had already been growing about the financial stability of FTX despite his good standing in Washington as a public face of crypto investing.

Media reports suggest that FTX had needed to find about $8.0 billion to plug a massive hole in its finances and escape bankruptcy.

Binance meanwhile axed its FTX takeover deal late on Wednesday and cited recent press reports about mismanagement of client funds – and investigations by US regulators.