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After 18 months of hardship, John Ray II’s team is preparing FTX’s big return to investors. Good news that will also please the crypto community: refunding dissatisfied customers. But that’s not all, FTX even plans to pay them more than their initial investment.
FTX: High Pressure Rebirth!
Crypto exchange FTX, in the midst of turmoil after its bankruptcy in 2022, offersn bold reorganization plan. Under this new plan 98% of its creditors could collect 118% of their debts in cash within 60 days of court approval, new documents filed Tuesday night revealed.
This plan allows for that tooOther non-governmental creditors would collect 100% of their claimsto which 9% interest would be added as compensation” the time value of their investments “. This proposal remains subject to approval by the Delaware Bankruptcy Courtentrusted with the supervision of bankruptcy proceedings.
These promised payments are higher than previous estimates by FTX, which announced in October that it would be unable to pay that 90% of client funds. In January, John Jay Ray III, FTX’s current CEO, revised that estimate and assured the court that he was able to fully reimburse customers.
Despite the uncertainties, the crypto market has since recovered the collapse of FTX and as a result crypto FTT as well as the bankruptcy that followed. However, this recovery did not assuage the anger of many FTX customers who were unable to benefit from the rise in cryptocurrency prices and their funds were stuck in bankruptcy.
FTX claimed this in a statement released on Tuesdayit now had $14.5 to $16.3 billion in liquidity available for distribution after a year and a half of collecting and disposing of the company’s scattered assets around the world.
” FTX.com had a massive deficit at the time of filing for Chapter 11 in November 2022 – holding only 0.1% of the Bitcoin and only 1.2% of the Ethereum customers thought they held. », Specifies a press release. ” As a result, borrowers could not benefit from the appreciation of these missing tokens. »
Other sources of value, including FTX and Alameda Research’s investments — like their 8% stake in AI startup Anthropic, which was sold in parts to institutional investors for $884 million in March — have been liquidated to generate cash to pay down debt.
As a reminder, the former CEO of this American crypto exchange, Sam Bankman-Fried, was sentenced to 25 years in prison for embezzling client funds.
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The blockchain and crypto revolution is in full swing! And on the day the effects are felt by the most vulnerable economy in this world, I will say against all hope that I had something to do with it
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The comments and opinions expressed in this article are solely those of the author and should not be considered investment advice. Before making any investment decision, do your own research.