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FTX Reveals Massive Stash Of Recovered Assets, But Is It Enough To Pay Customers?

  • September 12, 2023

In a recent development, the defunct crypto exchange FTX has revealed the total assets it has recovered since its bankruptcy proceedings began. However, the question on the minds of many is whether or not these assets will be enough to repay the company’s customers.

FTX Recovers $7 Billion In Total Assets

According to a court filing dated September 11, the bankrupt crypto exchange has marshaled $7 billion in total assets to date. This $7 billion includes the $0.8 billion in assets recovered by the government, $500 million in brokerage assets, $2.6 billion cash recovered before the petition and post-petition, and $3.4 billion in crypto assets.

Solana’s SOL is the company’s largest crypto holding, with over $1.16 billion in SOL held by FTX. BTC ($560 million), ETH ($192 million), APT ($137 million), USDT ($120 million), XRP ($119 million), BIT ($49 million), STG ($46 million), WBTC ($41 million) and WETH ($37 million) form the remainder of the company’s top 10 crypto holdings.

The company classified these crypto tokens as its “Digital asset A holdings” as it holds other crypto tokens. However, those tokens are classified as “Category B tokens” because they “fail to meet liquidity thresholds.” 

FTX currently holds a total of $506 million from its token investments. The company invested in these tokens during or after their initial coin offerings (ICO). However, they are not readily accessible to the company as these tokens are expected to be delivered based on a vesting schedule. SOL is the company’s biggest token investment, with $137 million worth of SOL vested.

The company also has $529 million in brokerage investments. These investments include $417 million in Grayscale’s Bitcoin Trust and another $70 million in Grayscale’s Ethereum Trust. Other investments are made in Bitwise and BlackRock’s funds.

FTX’s former CEO, Sam Bankman-Fried (SBF), was also known to have invested in several companies long before the crypto exchange. The filing shows that FTX’s venture portfolio includes 438 investments, including equity investments in Yuga Labs, the company behind famous NFT projects Bored Ape Yacht Club (BAYC) and Mutant Ape Yacht Club (MAYC).

FTX FTT Token price chart from Tradingview.com

FTT token price holds above $1 | Source: FTTBUSD on Tradingview.com

Will These Assets Be Sufficient To Repay Customers?

According to the court filing, close to 36,075 customer claims have been filed, amounting to $16 billion, which the company owes. However, FTX has scheduled only $10.9 billion of customer claims to date.

72% of these scheduled claims are yet to agree or dispute it, while 10% have agreed with it, and 18% have disputed their scheduled claim amount, most likely claiming that the company owes them more than it has stipulated. 

According to the company, the persons falling under 72% of customers who are yet to respond to the scheduled claims have until September 29 to file a proof of claim if they dispute it. FTX also plans to return its proposal to the Joint Provisional Liquidators (JPL) that same day.

It, however, remains to be seen whether or not these assets will be sufficient to repay these customers, as there are still steps that need to be taken before the company can use these assets for repayment. 

First, the court will need to approve the company’s recovery plan, and when that is done, it will need to liquidate those assets in line with the bankruptcy court’s directives.

Featured image from The Economic Times, chart from Tradingview.com

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