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Most of the cryptocurrency company’s customers will receive all their money back
Sam Bankman-Fried, co-founder of FTX Cryptocurrency Derivatives Exchange, arrives in court in New York, United States, Thursday, February 16, 2023.
Yuki Iwamura | Bloomberg | Getty Images
Almost all customers of the collapsed FTX cryptocurrency exchange will receive their money back — and more, according to a court document.
FTX estimates it owes creditors about $11.2 billion, according to a reorganization plan released late Tuesday. The company said it has between $14.5 billion and $16.3 billion to distribute to creditors.
Customers whose claims total $50,000 or less will receive approximately 118% of the allowable claim amount, the plan states. Approximately 98% of creditors will receive this compensation.
The reorganization plan, which still needs to be approved by the bankruptcy court, will likely bring some relief to FTX customers, whose money has been tied up at the exchange since it launched. filed for bankruptcy protection in November 2022.
FTX’s high-profile founder, Sam Bankman-Fried, era convicted on seven counts in early November, including allegations related to the theft of billions of dollars from FTX customers. He received a 25-year prison sentence.
FTX managed to raise funds by selling a number of assets, including venture capital investments held by the exchange and other investments held by Alameda, Bankman-Fried’s crypto hedge fund.
One of FTX’s highest profile investments has been in the artificial intelligence company Anthropic, a company backed Of Amazon. FTX sold most of its stake in Anthropic this year, making nearly $900 million.
FTX has had to find other ways to raise funds because a large sum of cryptocurrency is missing from the exchange.
“As a result, debtors were unable to benefit from the appreciation of these missing tokens during Chapter 11 cases. Instead, debtors had to seek other sources of recoverable value to repay creditors,” FTX said in a press release Wednesday. .
Cryptocurrency prices have appreciated tremendously since November 2022. Bitcoin has increased approximately 270% since FTX’s bankruptcy filing.
After Bankman-Fried’s resignation, FTX appointed John Ray III as CEO. There is talk of FTX in November 2022Ray said that “in his 40 years of legal and restructuring experience,” he had never seen “such a complete failure of corporate controls and such a complete absence of reliable financial information as occurred here.”
“We are pleased to be able to propose a Chapter 11 plan that provides for 100% repayment of bankruptcy claim amounts plus interest to non-government creditors,” Ray said in Wednesday’s press release.
— CNBC’s MacKenzie Sigalos contributed to this report.