FTX Customers Poised to Recover All Funds Lost in Collapse
Source: New York Times
Customers of the failed cryptocurrency exchange FTX are poised to recover all of the money they lost when the firm collapsed in 2022 and receive interest on top of it, the companys bankruptcy lawyers said on Tuesday.
The announcement was a landmark in the attempt to recover the $8 billion in customer assets that disappeared when FTX imploded virtually overnight, setting off a crisis in the crypto industry. Under a plan filed in federal bankruptcy court in Delaware, virtually all FTXs creditors, including hundreds of thousands of ordinary investors who used the exchange to buy and sell cryptocurrencies, would receive cash payments equivalent to 118 percent of the assets they had stored on FTX, the lawyers said.
Those payments would flow from a pool of assets that FTXs lawyers have pulled together in the 17 months since the exchange collapsed, the lawyers said.
But the recoveries come with a caveat. The amount owed to customers was calculated based on the value of their holdings at the time of FTXs bankruptcy in November 2022. That means customers wont reap the benefits of a recent surge in the crypto market that sent the price of Bitcoin to a record high. A customer who lost one Bitcoin when FTX imploded, for example, would be entitled to less than $20,000, even though a Bitcoin is now worth more than $60,000.
Read more: https://www.nytimes.com/2024/05/08/business/ftx-bankruptcy-recovery.html?smid=tw-nytimes&smtyp=cur
JT45242
(2,333 posts)And they should tax this at some ridiculous high capital gains rate.
You gamble on crypto to help launder money from around the world, then you assume all risk.
If this is taken from assets of the leaders of FTX, they should still tax it heavily.
bucolic_frolic
(43,609 posts)and they're surely not doing this for nothing.
former9thward
(32,203 posts)This is a government/court action. So, no, no one will lose 40%. They will get reimbursed for 100% their losses plus interest.
marble falls
(57,794 posts)brooklynite
(95,136 posts)Not is it a Ponzi scheme.
Individual investments can be offered and accepted irresponsibly. In aggregate its a great long term strategy for wealth accumulation.
marble falls
(57,794 posts)brooklynite
(95,136 posts)Our net worth increase since 2013 based on monthly investments in a balanced portfolio of asset classes. No dice required.
marble falls
(57,794 posts)FakeNoose
(32,976 posts)IronLionZion
(45,692 posts)For a bankrupt company, FTX held billions of dollars in assets from venture capital and other legit investments. Around $900 million was from selling their holding in AI firm Anthropic.
Tom Brady was just roasted about this on his Netflix special. But I guess he's getting all his money back. Good for him I guess.
Prairie Gates
(1,140 posts)Oooooof.