Bankrupt FTX exchange has accumulated $4,46 billion in cash by the end of 2023
At the same time, the company does not expect to fully cover customer claims
29.01.2024 - 09:05
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What’s new? FTX was actively selling cryptocurrencies late last year to raise cash to pay customers whose accounts were frozen following the crypto exchange’s bankruptcy in November 2022. In the last two months of 2023, the amount of cash in the accounts of major companies within the FTX Group, including FTX Trading and hedge fund Alameda Research, nearly doubled, from $2,3 billion to $4,46 billion.
What else is known? According to a report for the bankruptcy court, by December 8, the company had raised $1,8 billion through the sale of digital assets. It also traded bitcoin derivatives to hedge risk and generate additional returns through digital assets.
In total, FTX raised $2,5 billion by year-end, while Alameda Research raised $1,5 billion, West Realm Shires raised $288,9 million, and Clifton Bay Investments raised $173,7 million. The company’s total cash is likely larger, taking into account the rest of its affiliates.
That said, FTX managers expect clients will not receive full compensation. In December, they presented a new payment plan, according to which the amount of claims is proposed to be evaluated at the rates of cryptocurrencies at the time of bankruptcy. Since then, the rates of most assets have grown two or more times, and the total capitalization of the crypto market has increased by 108% in 2023 alone.
Thus, the plan involves multimillion-dollar losses for users, and some of them are trying to challenge the initiative of the exchange managers.
Earlier, it became known that FTX completely liquidated its position in the spot exchange-traded bitcoin fund of Grayscale, which until January 11 functioned as a bitcoin trust without the possibility of redeeming shares. The exchange sold off 22 million GBTC shares for $1 billion.
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