Written by: Lucy
On May 8, FTX and its affiliated debtors filed a reorganization plan and disclosure statement with the U.S. Bankruptcy Court in Delaware, which is expected to centrally distribute substantially all of FTX’s assets at the time of its bankruptcy in November 2022 to customers and other creditors around the world.
After experiencing the dark era of FTX’s collapse, “full compensation” may be the word that creditors are most eager to hear. As a result, FTX’s platform currency FTT has seen a pull-up trend, rising all the way to break through $2.1, with a 24-hour increase of 19.16%.
FTX restarts, creditors will get back 118% in 60 days
When FTX declares bankruptcy, creditors will face lengthy bankruptcy proceedings in court with no guarantee of what percentage of their claims will be compensated.
Calculating the exact timing and value of claim trades has been complicated since FTX filed for Chapter 11 bankruptcy in Delaware District Court on Nov. 11, 2022. Some claims trades were conducted on online platforms, others were private transactions where buyers were not required to submit transfer applications immediately, creating delays, and some claims were simply reported as their own claims, industry traders told Fortune.
Most creditors want to get at least some of their money back, so without certainty about how a deal will offset their exposure, some may sell their claims at a low price, with the buyers’ losses depending on how much debt the bankruptcy administrator is able to recover.
On Claims Market, the industry’s main online trading platform, more than $439 million worth of claims had been exchanged in 49 transactions as of March 28. Meanwhile, hedge funds had bought more than $2.3 billion worth of deeply discounted claims as of March 20, according to court records.
FTX estimates that the total value of property collected, converted to cash and available for distribution will be between $14.5 billion and $16.3 billion. This amount includes assets controlled by the Chapter 11 Debtors and assets controlled by the Joint Official Liquidators of FTX Digital Markets, Ltd. (Bahamas), the Securities Commission of the Bahamas, and FTX Australia.
That is, if the reorganization plan is approved by the bankruptcy court, 98% of FTX creditors will receive approximately 118% of their allowed claims within 60 days of the plan taking effect. The remaining creditors will receive all their claims, "plus billions of dollars in compensation for the time value of their investments."
Bitcoin and SOL are the saviors
It can be said that FTX’s “rebirth” is largely due to the surge in Bitcoin and SOL.
According to data submitted in the FTX case report, FTX's estate includes approximately 59 million SOL and 21,482 Bitcoin. These tokens have risen by approximately 1,000% and 343%, respectively, since the company filed for bankruptcy. FTX will sell 41 million SOL to institutional investors at a price 68% lower than the current market price, which is worth approximately $6 billion as of the time of this article.
Did Bitcoin Haters Anticipate the 'Bitcoin Bull Run'?
In SBF's eyes, Bitcoin has no future as a payment network, and he criticized Bitcoin for its inefficiency and high environmental costs. He once said, "The Bitcoin network is not a payment network, nor is it an expansion network." Perhaps it is well known that SBF hates Bitcoin. Ark Invest CEO Cathie Wood once said on her social platform, "SBF does not like Bitcoin because Bitcoin is transparent and decentralized, and SBF cannot control Bitcoin."
Since SBF was arrested and imprisoned, the crypto winter has lasted for nearly a year. However, with the Bitcoin halving and ETF expectations, the hype has gradually increased. On January 11, the Bitcoin ETF was successfully approved, and the crypto industry opened a new chapter. A large amount of funds entered the Bitcoin ecosystem through ETFs. Apart from the meme carnival, Bitcoin has gone from inscriptions to runes, and then to the flourishing L2, which can be described as a "Bitcoin bull market."
Even though SBF hates Bitcoin, he does not deny its material value and still trades Bitcoin for profit as an investor. According to the data submitted in the FTX case report, FTX still held tens of thousands of Bitcoins when it declared bankruptcy. Bitcoin has reached new historical highs step by step in this round of bull market hype. Although it has experienced multiple pullbacks, most researchers still have confidence in its future.
SBF, who is in prison, may not have witnessed this historic moment in person, but it is undeniable that it was Bitcoin, which he once criticized, that once again injected funds into the crypto world.
Investors who mutually select SOL
During this period when Bitcoin has become the leading currency, SOL is also a target that cannot be ignored, and the relationship between FTX and Solana is a good story in the crypto circle.
Solana has never been a team born with a silver spoon in their mouth. After the validator node fundraising ended in 2019, Anatoly and Raj insisted on focusing on development and launching the mainnet first, and this move attracted the attention of SBF. At that time, SBF was looking for cooperative public chains everywhere. Among the well-known public chains, Solana may not stand out, but one thing made SBF decide to invest deeply in Solana.
After SBF, Anatoly and Raj learned about Solana, he immediately asked engineers to send a large number of spam transactions to Solana to test the performance of Solana's public chain. Solana withstood the challenge, and SBF decided to invest in Solana that day. A few days later, the design of Serum, a decentralized order book matching engine incubated by FTX itself, was born.
It can be said that the mutual choice between FTX and Solana has created each other, and SBF is naturally a loyal investor in SOL. SBF believes that Solana may become the next Bitcoin, and Solana's market value may exceed Ethereum. Not many blockchains can be compared with Solana. "Solana is one of the few public blockchains with a truly reasonable roadmap. It can scale millions of transactions per second, and each transaction only costs a few cents. This is the scale advantage that users need."
After FTX declared bankruptcy, the Solana public chain was also hit hard and fell into trouble, and the price of SOL plummeted. However, Solana still attracted countless users to invest with its high performance and low gas. Especially since the outbreak of the low meme craze last year, the price of SOL broke through three digits and broke the historical high many times.
Since being detained last summer, SBF has been obsessed with Solana even in prison, and even reportedly recommended investing in SOL to prison guards. Although SOL has also experienced a pullback in several market corrections, it has remained at a three-digit price so far, which is enough to earn FTX huge profits.
Now, SBF has been convicted of all seven counts, and he was eventually sentenced to 25 years in prison by the Manhattan Court of the United States and issued a sky-high fine of $11 billion. The chapter of FTX led by this legendary figure has finally come to an end. The reorganized FTX may open a new chapter after paying creditors in full, but with the recent tightening of supervision, whether FTX's restructuring proposal can be passed remains to be determined.
