It’s been a rough road for FTX, as most in the crypto sphere are already aware. But it seems like desperate measures are still being taken to keep the entity alive. A major problem faced by FTX right now is that key staff members including coders and accountants are on the verge of quitting. Current FTX CEO John J Ray is now looking for ways to keep the staff around.
His solution seems to be the introduction of a bonus program. According to Ray, he is looking to put $4 million up for grabs to staff, allowing the employees to claim as much as 94% of their standard salary. It seems like a crazy move for a bankrupt company, but Ray insists that it is necessary. In the CEO’s filing, he made the situation clearer.
Ray’s filing explains that retaining staff at FTX is absolutely crucial. He stresses that not only are the staff members in possession of key knowledge, but they would also be extremely difficult to replace given their specialised skill sets. He continues that offering a bonus program is the only practical way to keep them from quitting. Ray goes on to say that the understanding of debtors is essential on the matter, given the current financial situation of the company.
It remains to be seen how the request for a $4 million bonus program will be received. The matter will be heard in the Delaware bankruptcy court on March 29th, though if the court will understand Ray’s position is uncertain. Especially given that Ray has already confessed that there will be a massive shortfall in trying to pay back creditors.
Ray has emphasised that staff are not simply being paid off and that bonuses will range between 17% and 94% depending on circumstances. He has also made it very clear that no bonuses of any kind are going to directors, officers, or Sam Bankman-Fried.
The question most people are now asking is why Ray is so desperate to retain the staff. It all comes down to programming, the rarity of specific skill sets, and how necessary programming is in the world of crypto. In this case, the required languages are Python, Rust, and Flutter. There are simply only so many programmers proficient in these languages, and if FTX loses these programmers it will be very difficult to find replacements.
As far as the courts are concerned, the chances are good that Ray’s request will be granted. In January a New Jersey judge was handed a similar request, though the request did not come from FTX. It came from BlockFi. Faced with a similar situation to that of FTX, BlockFi requested a $10 million staff retention programme. The request was granted.
What FTX’s future holds is unknown, especially as far as whether the company will stay afloat is concerned. Most traders have already accepted that FTX is no more, but there is still the more important matter of hundreds of millions in outstanding debt.
