As a researcher with years of experience in the volatile world of cryptocurrencies and blockchain technology, I must admit that I’ve seen quite a few twists and turns during my career. The latest development in the FTX saga is no exception. It’s fascinating to see how events have unfolded since November 2022 when FTX imploded, leaving customers hanging on to mere hopes of recovering their assets.
According to a report from Bloomberg’s Steven Church and Jonathan Randles, FTX has been given court permission to reimburse customers whose digital assets were locked on the platform following its collapse about two years ago.
The approval originates from U.S. Bankruptcy Judge John Dorsey, as he endorsed a strategy that permits FTX to reimburse customers impacted by the collapse of Sam Bankman-Fried’s exchange. This decision might also lead shareholders to receive a portion of approximately $1 billion in confiscated assets.
By November 2022, when FTX collapsed, customers were confronted with the prospect of only getting back a small portion of what they were originally owed. Yet, by June 2024, FTX had amassed an estimated $12.6 billion in assets. This figure could potentially rise to as high as $16.5 billion once all platform-owned assets are sold. These assets encompass shares in diverse businesses, including the artificial intelligence firm Anthropic.
Lawyer Ken Pasquale, acting on behalf of the creditors, pointed out that the crypto market’s surge over the past year has significantly boosted the worth of FTX’s assets. This growth enabled FTX to engage in talks with creditors and regulatory bodies, potentially enhancing the chances of customer reimbursement.
In an uncommon turn of events, shareholders of FTX might receive some funds – a scarce occurrence in Chapter 11 bankruptcies where stockholders typically receive nothing. A portion of these funds originates from the sale of assets confiscated by the government, including $626 million from the sale of Robinhood shares that belonged to Bankman-Fried and co-founder Gary Wang earlier.
Instead of using cryptocurrencies for repayments, some clients have expressed dissatisfaction because their payments will be made in cash. This implies they won’t gain from the recent growth of digital assets. It’s important to note that payments to customers won’t be instant, as FTX is currently setting up a trust and hiring a company to manage the distribution of funds.
In November 2022, FTX sought protection under bankruptcy laws, while its co-founder, Sam Bankman-Fried, has since faced charges and been found guilty of fraudulent activities.
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2024-10-08 11:04