- Bankrupt crypto exchange FTX has recovered $7.3 billion in cash and liquid crypto assets.
- FTX has gained from the recent spike in cryptocurrency prices, the firm’s bankruptcy counsel told the court.
Bankrupt crypto exchange FTX has recovered approximately $7.3 billion in cash and liquid crypto assets, an increase of more than $800 million since January, according to the company’s counsel at a bankruptcy court hearing in Delaware.
According to FTX attorney Andy Dietderich, the company is beginning to consider its future after months of labor committed to gathering resources and determining what went wrong under the leadership of accused ex-founder Sam Bankman-Fried “SBF.”
Dietderich said that FTX has gained from the recent spike in cryptocurrency prices. Its total recovery would be about $6.2 billion based on crypto prices from November 2022, when it declared bankruptcy after traders withdrew $6 billion from the marketplace in three days.
John J. Ray III, the new FTX CEO, has described the failed crypto exchange’s illicit fund transfers and inadequate bookkeeping as a “complete failure” of controls.
Operations to possibly resume in Q2 2024
Looking ahead, FTX is engaging with stakeholders about options for restarting its crypto exchange, and a decision could be made in the current quarter, according to Dietderich.
It is unclear whether FTX should restart the exchange using its own finances rather than utilizing the money to compensate clients.
Relaunching the exchange may necessitate outside funding or the sale of the exchange’s assets. According to Dietderich, FTX is also working on a preliminary Chapter 11 plan that would provide the company with a way out of bankruptcy.
Dietderich provided scant information on what a reboot may mean for FTX customers whose crypto deposits have been locked up during the bankruptcy proceedings.
So far, FTX users only in Japan have been able to withdraw funds due to the country’s relatively robust crypto legislation, Dietderich added.
FTX plans to file the plan by July, but it admits that many specifics will need to be ironed out as creditors compete for their part of the company’s assets. FTX believes that no Chapter 11 plan will be authorized before the second quarter of 2024.
Following the court filing, the value of the FTT token surged by more than 100% within 24 hours. At press time, it was trading at $2.28.