FTX Bankruptcy Claims Skyrocket as Company Recovers $7.3 Billion in Assets
According to a Wednesday report by digital assets platform Matrixport, the market value of bankruptcy claims against crypto exchange FTX has more than tripled this year. This comes ahead of the founder and CEO Sam Bankman-Fried's impending criminal trial set to begin next week.
The FTX bankruptcy has been a complex affair, racking up over $200 million in legal fees. But in the over-the-counter markets, where bankruptcy claims are traded, prospects for creditors have recently improved dramatically.
Once perceived as a high-risk asset, FTX claims are now being dubbed as the most sought-after tickets by investors focused on distressed assets.
In late 2022, FTX filed for Chapter 11 bankruptcy, creating one of the most complicated bankruptcy cases in U.S. history. Data from Matrixport indicates that the expected payout for FTX creditors has risen to an average of 37 cents on the dollar, up from just over 10 cents at the beginning of the year.
John Ray III, a veteran Wall Street bankruptcy lawyer, has been steering FTX through the bankruptcy process. Under his leadership, FTX has managed to recover $7.3 billion of assets. These include $3.4 billion in crypto, $1.1 billion in cash, and $200 million worth of real estate in the Bahamas.
Another factor contributing to the optimism is FTX's $500 million stake in AI startup Anthropic. The crypto exchange had acquired the stake using customer funds, making it a subject of creditor claims.
Amazon's recent announcement of its intention to invest up to $4 billion in Anthropic could boost the value of these claims even higher.
A potential relaunch of the exchange, often referred to as FTX 2.0, could also play a pivotal role in the claims market. If the exchange manages to restart
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