FTX Recovers $5 Billion In ‘Liquid’ Assets!
FTX Recovers $5 Billion In ‘Liquid’ Assets!
Fallen crypto exchange FTX has recently reported to have succeeded in recovering $5 billion in liquid assets following previous reports that the platform had lost almost $9 billion in total liabilities.
Recovering Assets
According to a bankruptcy attorney during an FTX bankruptcy hearing Wednesday, FTX was able to recover more than $5 billion in cash and other liquid assets, which could be used to help repay creditors.
The $5 billion however, does not include other illiquid cryptocurrency tokens, which the attorney describes as “so large relative to the total supply” that selling them would greatly affect the market.
“We have located over $5 billion of cash, liquid cryptocurrency and liquid investment securities measured at petition date value. [It] just does not ascribe any value to holdings of dozens of illiquid cryptocurrency tokens, where our holdings are so large relative to the total supply that our positions cannot be sold without substantially affecting the market for the token,” Landis Rath & Cobb attorney Adam Landis said on FTX’s behalf.
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FTX has recovered more than $5 billion in different assets, not including another $425 million in crypto held by the Bahamas, a bankruptcy attorney said during a hearing Wednesday. FTX’s total liabilities range from $10b to $13b, meaning creditors could recover around 40%.
— Wu Blockchain (@WuBlockchain) January 11, 2023
It was also revealed that more than 9 million creditors were able to be identified, though it remains unclear just how much of their funds creditors will receive back from the $5 billion in recovered assets.
Lost Assets
Previously, FTX’ new CEO John J. Ray attested that at least $8 billion of customer assets were unaccounted for and possibly lost after former management team and former CEO Sam Bankman-Fried had misused these funds for a number of different unrelated purchases.
“We know what Alameda did with the money. It bought planes, houses, threw parties, made political donations. It made personal loans to its founders. It sponsored the FTX Arena in Miami, a Formula One team, the League of Legends, Coachella and many other businesses, events and personalities,” attorney Landis said.
“The amount of the shortfall is not yet clear. It will depend on the size of the claims pool and our recovery efforts. But every week we come closer to completing the work necessary to estimate recoveries for the purposes of a plan of reorganization.”
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