FTX run as personal fiefdom: lawyer

FTX was run as a "personal fiefdom" of former CEO Sam Bankman-Fried, lawyers for the collapsed crypto exchange have said in its first bankruptcy hearing as they detailed ongoing challenges such as hacks and substantial missing assets.

In the highest-profile crypto blow-up to date, FTX filed for protection in the United States after traders pulled $US6 billion ($A9 billion) from the platform in three days and rival exchange Binance abandoned a rescue deal.

The collapse has left an estimated one million creditors facing losses totalling billions of dollars.

A lawyer for FTX said at a bankruptcy hearing on Tuesday that the company now intends to sell off healthy business units but has been the subject of cyberattacks and had "substantial" assets missing.

FTX said on Saturday it has launched a strategic review of its global assets and is preparing for the sale or reorganisation of some businesses.

The hearing was held at the US Bankruptcy Court in Wilmington, Delaware and was livestreamed to about 1500 viewers on YouTube and Zoom.

A lawyer also said that the firm had been run as a "personal fiefdom" of Bankman-Fried with $US300 million spent on real estate such as homes and holiday properties for senior staff.

FTX, led since the bankruptcy filing by new CEO John Ray, has accused Bankman-Fried of working with Bahamian regulators to "undermine" the US bankruptcy case and shift assets overseas.

Bankman-Fried did not immediately reply to an email seeking comment.

Reuters earlier reported that Bankman-Fried's FTX, his parents and senior executives of the failed cryptocurrency exchange bought at least 19 properties worth nearly $US121 million in the Bahamas over the past two years, official property records show.

Lawyers also said that an investigation must take place into Binance's sale of FTX in July 2021.

Binance bought a stake in FTX in 2019.

Separately a filing late on Monday by Ed Mosley of Alvarez & Marsal, a consultancy firm advising FTX, showed FTX's cash balance of $US1.24 billion as of Sunday was "substantially higher" than previously thought.

It includes about $US400 million at accounts related to Alameda Research, the crypto trading firm owned by Bankman-Fried, and $US172 million at FTX's Japan arm.

Reuters has reported Bankman-Fried secretly used $US10 billion in customer funds to prop up his trading business, and that at least $US1 billion of those deposits had vanished.

At the hearing, FTX representatives argued that names of customers should be kept secret, as disclosing them could destabilise the crypto market and open customers up to hacks.

FTX also argued that its customer list is a valuable asset and disclosing it could impair future sale efforts or allow rivals to poach its user base.

A judge said those names can remain undisclosed until a future court hearing.

FTX lawyers also described an uneasy truce with court-appointed liquidators overseeing the wind-down of FTX's Bahamas unit, FTX Digital Markets.

The two sides reached an initial agreement to co-ordinate their US-based insolvency proceedings before Judge John Dorsey, avoiding the possibility of conflicting rulings from two different US bankruptcy judges.

But both sides signalled they still have broader disagreements over how to co-ordinate the recovery and preservation of assets held by various FTX affiliates.