There’s now at least one bright spot in the ongoing FTX saga.
Customers of the cryptocurrency exchange—which imploded back in November 2022 and led to the imprisonment of Sam Bankman-Fried—will get their money back, plus interest, The New York Times reported on Wednesday. The company has recovered some $8 billion in assets, and all of FTX’s creditors will receive cash payments equal to 118 percent of the assets they had kept in the exchange, the company’s bankruptcy lawyers said, according to the Times.
The amount of money that FTX has found is “in general pretty unheard of,” Yesha Yadav, a Vanderbilt University law professor, told the newspaper. “That’s something that is really quite astonishing for a major bankruptcy.”
While FTX customers will be receiving refunds, the amount of money will be based on their holdings’ value when the company went bankrupt a year and a half ago, the Times noted. So if someone had just one bitcoin back then, they would receive less than $20,000, even though a bitcoin is currently worth more than $60,000. And it will take a while before people begin to see that cash: The judge overseeing FTX’s bankruptcy has to approve the plan, which could take months, if not longer depending on any pushback from creditors.
Still, it’s impressive that FTX’s clients are getting any money back at all. Bankman-Fried was convicted of using billions of dollars from his customers for political donations, investments, and other personal spending, and he currently serving 25 years in prison as a result. But FTX was able to get back much of the money: It sold the majority of its stake in the artificial-intelligence company Anthropic for $884 million, the Times wrote, and took back more than $400 million from a hedge fund that Bankman-Fried had financed. Plus, lawyers have sued those involved in the company, including Bankman-Fried’s parents, in an attempt to get money from them.
The latest development in the FTX scandal is likely welcome news for those who thought they had no chance of retrieving their lost dollars from the failed company. Hundreds of thousands of everyday investors had bought and sold crypto via the exchange, The New York Times noted. And a number of celebrities were also enmeshed in the debacle.
We’re not sure if Tom Brady actually misses his lost $30 million, but he may be able to breathe a sigh of relief now.
Authors
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Tori Latham
