On May 23, 2018, we published revised versions of our Privacy Policy and User Agreements. Please read these updated terms and take some time to understand them. Your use of our services is subject to these revised terms.
Yes, I Agree.

FTX to Repay Clients Fully but Exchange Won’t Reopen

Sam Bankman-Fried’s defunct crypto exchange FTX disclosed in a recent court session that it intends to fully reimburse its clients. Bankman-Fried was convicted last year for fraud and embezzling client funds before the exchange’s demise in 2022. The reimbursement, however, hinges on the precise moment FTX officially filed for bankruptcy, a time coinciding with market instability. Judge John Dorsey of the United States Bankruptcy Court granted preliminary approval for that particular date.

During the hearing, Kris Hansen, the legal representative for the exchange’s creditor committee, stated that many claims relied on currencies that saw substantial devaluation in the tumultuous time frame preceding the bankruptcy filing. Investors lodged a formal court complaint last month arguing that they are not getting a fair deal, particularly in light of the ensuing spike in Bitcoin and other cryptos in recent months.

Bitcoin’s value has increased since FTX collapsed in November 2022, surpassing $43,000, a stunning 110% rise from its roughly $20,500 worth at the time of the exchange’s demise.

Andrew Dietderich, FTX’s attorney, cautioned investors during the court session that the possible recovery should not be viewed as a guarantee but rather as a target, highlighting the high risks, work and efforts needed to get the best results.

Claimants are required to submit proof of asset ownership on the crypto exchange and subsequent losses as part of the planned reimbursement process in the United States bankruptcy court. The claims will THEN be carefully examined by restructuring advisors to determine their legitimacy.

Dietderich added that the exchange has given up on relaunching its platform since there aren’t enough buyers; it is now concentrating on making its previous clients whole. In June 2023, John J. Ray III, the current CEO of FTX, disclosed that the company had initiated the process of seeking interested parties for the relaunch of FTX.com. In November, SEC Chair Gary Gensler expressed receptiveness to a relaunch of FTX — but only provided the new leadership complies with regulatory requirements.

The recent court actions were intended to advance the lawsuit by enabling various creditor groups to secure individual investor permission for the most recent approach to recuperating their assets. According to data from Xclaim, approximately 15 million individuals collectively lost between $30 billion and $35 billion in various cryptos following FTX’s collapse in November 2022.

Following the exchange’s reimbursement intentions, FTX’s token, FTT, saw an initial 11% increase but then crashed, with a 15% loss.

The revelation that FTX won’t be reopening soon is a sobering reminder to other actors in the crypto space such as Hive Blockchain Technologies Ltd. (NASDAQ: HIVE) (TSX.V: HIVE) that some management mistakes can be fatal for a company, so they should always be vigilant and implement the best practices to stay afloat and thrive.

About CryptoCurrencyWire

CryptoCurrencyWire (“CCW”) is a specialized communications platform with a focus on blockchain and the cryptocurrency sector. It is one of 60+ brands within the Dynamic Brand Portfolio @ IBN that delivers: (1) access to a vast network of wire solutions via InvestorWire to efficiently and effectively reach a myriad of target markets, demographics and diverse industries; (2) article and editorial syndication to 5,000+ outlets; (3) enhanced press release enhancement to ensure maximum impact; (4) social media distribution via IBN to millions of social media followers; and (5) a full array of tailored corporate communications solutions. With broad reach and a seasoned team of contributing journalists and writers, CCW is uniquely positioned to best serve private and public companies that want to reach a wide audience of investors, influencers, consumers, journalists and the general public. By cutting through the overload of information in today’s market, CCW brings its clients unparalleled recognition and brand awareness. CCW is where breaking news, insightful content and actionable information converge.

To receive SMS alerts from CryptoCurrencyWire, text “CRYPTO” to 888-902-4192 (U.S. Mobile Phones Only)

For more information, please visit https://www.CryptoCurrencyWire.com

Please see full terms of use and disclaimers on the CryptoCurrencyWire website applicable to all content provided by CCW, wherever published or re-published: https://www.CryptoCurrencyWire.com/Disclaimer

CryptoCurrencyWire
New York, NY
www.CryptoCurrencyWire.com
212.994.9818 Office
Editor@CryptoCurrencyWire.com

CryptoCurrencyWire is powered by IBN

Archives

Select A Month

Official NewsWire Relationships

Anarchapulco Main Event Blockchain Africa Conference Blockchain Futurist Conference Blockchain Life Conference Blockchain Shift Coingenius Coinvention CryptoBlockCon CryptoFest European Blockchain Convention EVOLV - evolve.events Finovate nftexpoverse Paris Blockchain Week The North American Bitcoin Conference Virtual Blockchain Week The Voice of Blockchain World Crypto Conference

CryptoCurrencyWire Currently Accepts

Bitcoin

Bitcoin

Bitcoin Cash

Bitcoin Cash

Doge Coin

Dogecoin

Ethereum

Ethereum

Litecoin

Litecoin

USD Coin

USD Coin

Contact us: 212.994.9818