Taking Bitcoin as an example, when FTX filed for bankruptcy, the price of BTC was around $16,000, and it has now soared to about $98,000. If a creditor held one Bitcoin at that time, they may now only be able to recover $16,000, which is about 16% of the current price, resulting in significant losses.
Misunderstandings about FTX repayments
Recently, FTX announced it would start repaying $16 billion to creditors on January 3, which is a significant positive for the crypto market. However, the first batch of repayments is expected between February and March 2025, involving only 'convenience class' creditors, totaling $1.2 billion.
For creditors with claims exceeding $50,000, $10.5 billion will be paid later. The overall asset situation of FTX is as follows:
Cash reserves: $13 billion
Venture Capital Portfolio and Litigation Gains: Estimated $5 billion to $7 billion
About 50% of the debts have been acquired by buyers who are not very interested in crypto assets, which may weaken the likelihood of funds flowing back into the crypto market.
Many institutions have acquired some debts at discounted prices. Nevertheless, the compensation process for FTX is still slowly advancing, which is better than nothing.
Impact on the crypto market
For the crypto market, this event has brought some liquidity growth. Currently, bankruptcy-related tokens such as FTT, LUNA, LUNC, and USTC are worth paying attention to.$FTT