FTX Debtors Identify $5.5B in Liquid Assets
- FTX’s debtors said it took a “herculean investigative effort” to identify the $5.5 billion in liquid assets connected to the exchange.
- $1.7 billion in cash, $3.5 billion in crypto, and $300 million in securities has been found so far, with the debtors noting there was a “substantial shortfall of digital assets” at FTX.com and FTX.US.
Former CEO of FTX Sam Bankman-Fried leaves the Federal Court in New York after pleading not guilty, 3 January, 2022.
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Troubled cryptocurrency exchange FTX has identified around $5.5 billion in liquid assets, but this number includes $413 million worth of crypto stolen from the exchange, the company said in a press release on 17 January.
According to the announcement, the debtors behind the crypto exchange met with the committee of unsecured creditors of FTX on Tuesday to share a presentation on their asset recovery process. So far, they were able to identify $5.5 billion in liquid assets following FTX’s Chapter 11 bankruptcy filing in November, $1.7 billion of which in cash, $3.5 billion in digital assets, and $300 million in securities. Chief Restructuring Officer and CEO of FTX, John Ray, said in a statement:
“We are making important progress in our efforts to maximize recoveries, and it has taken a Herculean investigative effort from our team to uncover this preliminary information. We ask our stakeholders to understand that this information is still preliminary and subject to change. We will provide additional information as soon as we are able to do so.”
The press release also noted that the identified assets connected to both FTX.com and FTX.US at this time were “substantially less” than the aggregate third-party customer balances suggested by FTX’s electronic ledger.
The debtors have found $1.6 billion of digital assets connected to FTX.com, though only $742 million were under their control. The Securities Commission of the Bahamas held $426 million of FTX.com’s assets in cold storage, $323 million was “subject to unauthorized third-party transfers”, and $121 million was pending transfer to cold storage under the control of the FTX debtors.
When it comes to FTX.US, $181 million of digital assets has been identified so far, $88 million of which was in cold storage under the control of the debtors, $90 million was “subject to unauthorized third-party transfers”, and $3 million pending transfer to cold storage. The debtors noted that these assets were substantially less than the amount shown in FTX.US’ ledger, suggesting that Sam Bankman-Fried’s claim of the exchange being “fully solvent” prior to its Chapter 11 filing was false.
- The New York Jurors took 4 fours of deliberating before pronouncing the former FTX CEO guilty of all seven charges of fraud and conspiracy to commit fraud.
- Bankman-Fried will now have to appear in court on 28 March, 2024, where he will face a potential maximum sentence of 115 years in prison.
Former CEO of FTX Sam Bankman-Fried leaves the Federal Court in New York after pleading not guilty, 3 January, 2022.
lev radin/Shutterstock
- A little over $13 million in altcoins were sent to crypto exchanges Binance and Coinbase in the past 24 hours, which is in accordance with a September court order.
- The court ordered a phased liquidation process, which allows the bankruptcy estate to sell $3.4 billion worth of digital assets over a certain period of time.
- Joseph Pimbley, a member of litigation consulting firm PF2 Securities, will try to rebuff testimonies from Caroline Ellison, Gary Wang, Nishad Singh, and Adam Yedidia.
- During his testimony Pimbley will try to establish a timeline for the FTX-Alameda line of credit, and convince the jury it fluctuated between $1 billion and $3 billion between 2021 and 2022.