FTX cryptocurrency exchange has billions more than needed to repay customers
The former chief of cryptocurrency exchange FTX, Sam Bankman-Fried, has been sentenced to 25 years in prison for defrauding customers and investors of the now-bankrupt firm. However, FTX has announced that it has billions of dollars more than it needs to repay customers, with a reorganisation plan in place to cover the debts.
The firm stated that once it sells off its remaining assets, it will have around $16.3 billion to cover the debts, which amount to approximately $11 billion. The new chief executive, John Ray, expressed optimism about the proposed chapter 11 plan, which aims to return 100% of bankruptcy claim amounts plus interest for non-governmental creditors.
FTX has been gathering funds to pay its debts by selling assets and investments held by Alameda Research or FTX Ventures businesses, both of which were controlled by Bankman-Fried. Despite a jump in crypto prices since the company’s collapse, FTX mentioned that almost all of the Bitcoin and other digital currencies believed to have been held by the exchange at the time of its downfall are missing.
The price of Bitcoin has risen by around 270% since FTX filed for bankruptcy more than a year and a half ago. FTX was once one of the world’s largest crypto platforms, attracting millions of customers before its downfall. Reports of financial trouble led to customers withdrawing billions of dollars from the exchange, ultimately causing its implosion and exposing the extent of Bankman-Fried’s crimes. The reorganisation plan still needs approval from a US bankruptcy court.
