Smiley face
Weather     Live Markets

The FTX bankruptcy estate has set a goal to start repaying customers by the end of 2024, as discussed during a meeting of FTX Digital’s Joint Official Liquidators in the Bahamas. The bankruptcy process involves both Chapter 11 bankruptcy overseen by a Delaware court in the United States and the official liquidation of FTX Digital, a Bahamas-based subsidiary. Creditors can submit claims to either entity and are expected to receive repayments based on their entitled value and Know Your Customer (KYC) documentation by the end of 2024. The deadline for submitting claims has been extended to at least June 2024, based on recent developments.

Creditors have been submitting claims through FTX’s claims portal since March 1, with a deadline initially set for May 15 but expected to be extended. Claims will be valued as of the initial bankruptcy claim date on November 11, 2022. In a strategic move to repay creditors, FTX agreed to sell the majority of its shares in AI startup Anthropic for $884 million. FTX and its sister firm Alameda had previously invested $500m in the AI firm, holding a 7.84% stake, which increased in value due to the surge in the artificial intelligence sector driven by the popularity of ChatGPT. Anthropic has secured substantial funding from major tech players like Amazon, Alphabet, and Salesforce.

Founder Sam Bankman-Fried, also known as SBF, has been sentenced to 25 years in prison following his conviction on all seven counts related to fraud and money laundering during his trial. The Department of Justice sought a harsh 40 to 50-year prison term for SBF, citing the devastating consequences of FTX’s collapse. The Southern District of New York (SDNY) Judge criticized SBF’s behavior during the trial, emphasizing his evasiveness and lack of cooperation. While federal criminal cases do not allow for parole, SBF could potentially reduce his sentence through good behavior, serving as little as 12.5 years if he receives all available jailhouse credit.

The first meeting of creditors of FTX Digital Markets discussed the plan to start repayments by the end of 2024, with a USD value based on November 12. There was a suggestion to explore a partnership with OKX, particularly @star_okx, to facilitate USDC distribution. This meeting indicated a reevaluation of the deadline for submitting claims, with an extension expected to at least June 2024. Additionally, the decision to sell shares in AI startup Anthropic for $884 million was made to generate funds for creditor repayments. Anthropic has seen significant funding from top tech companies, highlighting the appeal and value of the AI firm in the industry.

Overall, the repayment process for FTX creditors is scheduled to begin by the end of 2024, with the value of claims based on the initial bankruptcy claim date. The collaboration between Chapter 11 bankruptcy overseen by a Delaware court in the United States and official liquidation in the Bahamas aims to ensure all creditors receive their entitled value without any receiving less than they are due. The sale of shares in AI startup Anthropic for $884 million will help in repaying creditors, showcasing a strategic move by FTX to fulfill its obligations. Founder SBF’s sentencing to 25 years in prison demonstrates the legal consequences of fraudulent activities in the cryptocurrency space, underscoring the importance of transparency and accountability in financial transactions.

Share.
© 2024 Globe Timeline. All Rights Reserved.