{"id":40489,"date":"2022-11-16T02:44:53","date_gmt":"2022-11-16T06:44:53","guid":{"rendered":"https:\/\/coinscreed.com\/staging\/?p=40489"},"modified":"2022-11-16T16:36:49","modified_gmt":"2022-11-16T20:36:49","slug":"ftx-users-declare-pay-cents-on-the-dollar-post-bankruptcy","status":"publish","type":"post","link":"https:\/\/coinscreed.com\/staging\/ftx-users-declare-pay-cents-on-the-dollar-post-bankruptcy\/","title":{"rendered":"FTX Users Declare Pay Cents on the Dollar Post Bankruptcy"},"content":{"rendered":"\n
The cryptocurrency exchange FTX filed for bankruptcy<\/a> on Friday, leaving users' funds stuck on the platform. One marketplace for distressed claims posted bids for a fraction of the original value of claims.<\/h5>\n\n\n\n
\"FTX
FTX Users Declare Pay Cents on the Dollar Post Bankruptcy<\/figcaption><\/figure>\n\n\n\n

People who lost money on the troubled cryptocurrency exchange FTX and want to get at least some of it back can sell their credit claims<\/a>, but they'll only get back a small portion of their holdings.<\/p>\n\n\n\n

Cherokee Acquisition, a company that buys troubled assets and also has a market for credit claims against bankrupt companies, sent out its latest price table on Tuesday. It gave FTX users with deposit claims over $100,000 a guide price of 8 to 12 cents on the dollar.<\/p>\n\n\n\n

When a company declares bankruptcy or files for Chapter 11 bankruptcy<\/a> protection, like FTX did last Friday, creditors who don't want to wait until the end of a long bankruptcy process to get some or all of their assets back can sell their credit claims to companies that buy distressed assets.<\/p>\n\n\n\n

The relatively low prices<\/a> for FTX claims suggest that FTX users are less likely to get their money back.<\/p>\n\n\n\n

In comparison, Earn account holders of the bankrupt crypto lender Celsius Network may get around 20 cents on a dollar after selling their claims, while creditors of Voyager Digital, the crypto brokerage platform that was sold to FTX at auction, may get 40 cents on a dollar for their claims.<\/p>\n\n\n\n

Thomas Braziel, the managing partner at distressed corporate specialist 507 Capital, told CoinDesk that even this low price might be too much for some people to pay.<\/p>\n\n\n\n

He said, “No one will buy them at that price.” He said that 3 to 5 cents would be a more realistic market price for deposit <\/a>claims.<\/p>\n\n\n\n

\"\"
Table of bidding for crypto bankruptcy-related claims. (Cherokee Acquisition)
<\/figcaption><\/figure>\n\n\n\n

FTX, which is part of Sam Bankman-crypto Fried's conglomerate of more than 130 companies, filed for bankruptcy protection on Friday after it illegally used customer deposits for lending and investing and a bank run revealed a $10 billion hole in its balance sheet.<\/p>\n\n\n\n

Many people, including large trading firms like Genesis Trading, Galois Capital<\/a>, and Ikigai Asset Management, were left with their money stuck on the platform.<\/p>\n\n\n\n

After FTX first stopped withdrawals a week ago, users made ad hoc Telegram chat groups to sell their held deposits on the exchange.<\/p>\n","protected":false},"excerpt":{"rendered":"

The cryptocurrency exchange FTX filed for bankruptcy on Friday, leaving users’ funds stuck on the platform. One marketplace for distressed claims posted bids for a fraction of the original value of claims. People who lost money on the troubled cryptocurrency exchange FTX and want to get at least some of it back can sell their […]<\/p>\n","protected":false},"author":39,"featured_media":40491,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[32],"tags":[12233,778,11872],"class_list":["post-40489","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-crypto-exchange-news","tag-credit-claims","tag-ftx","tag-sam-bankman-fried-2"],"jetpack_featured_media_url":"https:\/\/coinscreed.com\/staging\/wp-content\/uploads\/2022\/11\/image-88.png","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/40489","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/users\/39"}],"replies":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/comments?post=40489"}],"version-history":[{"count":0,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/40489\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media\/40491"}],"wp:attachment":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media?parent=40489"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/categories?post=40489"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/tags?post=40489"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}