{"id":6360,"date":"2024-03-22T04:46:33","date_gmt":"2024-03-22T04:46:33","guid":{"rendered":"https:\/\/news.talkwithrattan.com\/index.php\/2024\/03\/22\/ftx-expects-us-to-reduce-bankruptcy-claim-to-3-billion-to-5-billion\/"},"modified":"2024-03-22T04:46:33","modified_gmt":"2024-03-22T04:46:33","slug":"ftx-expects-us-to-reduce-bankruptcy-claim-to-3-billion-to-5-billion","status":"publish","type":"post","link":"https:\/\/news.talkwithrattan.com\/index.php\/2024\/03\/22\/ftx-expects-us-to-reduce-bankruptcy-claim-to-3-billion-to-5-billion\/","title":{"rendered":"FTX expects US to reduce bankruptcy claim to $3 billion to $5 billion"},"content":{"rendered":"
\"FTX<\/div>


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Crypto exchange FTX<\/a> said it expects to negotiate U.S. government claims in its bankruptcy<\/a> down to $3 billion to $5 billion, leaving no money for shareholders and contradicting a “reckless and false” claim by founder Sam Bankman-Fried that FTX’s collapse caused no harm. <\/p>\n

FTX revealed those estimates in court documents on Wednesday in response to founder Sam Bankman-Fried’s claims that he should receive a light prison sentence because FTX will be able to repay its customers “in full”. Bankman-Fried was convicted in November of stealing $8 billion from FTX customers.<\/p>\n

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FTX’s current CEO John Ray said in court filings in Delaware bankruptcy court that Bankman-Fried had distorted the company’s recent statements about its ability to repay customers in bankruptcy to argue that there was “zero” harm to FTX customers, lenders and investors. <\/p>\n

“All of these statements are both reckless and false,” Ray wrote.<\/p>\n

“Even the best conceivable outcome in the Chapter 11 proceeding will not yield a true, full economic recovery by all creditors and non-insider equity investors as if the fraud never happened,” he said. <\/p>\n

FTX estimates that it will have $13.7 billion in assets to pay $31.4 billion in legitimate claims, including $9.2 billion in customer claims and $17 billion in claims asserted by the U.S. Commodity Futures Trading Commission and the Internal Revenue Service. <\/p>\n

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FTX said in January that it expects to pay customers “in full,” but that statement came with a major caveat: It will value customer claims based on the price of crypto in November 2022, and customers will receive no benefit from a significant rise in crypto prices since that date. Many FTX customers are “extremely unhappy” with FTX’s proposed repayment, Ray wrote. FTX proposed bankruptcy repayment still faces significant obstacles, including ongoing negotiations over the $17 billion in claims asserted by the U.S. government.<\/p>\n

FTX is working towards a settlement that would allow FTX to repay its customers before the government and reduce the total government claims to between $3 billion and $5 billion. The U.S. government has agreed to prioritize customer repayment in recent crypto bankruptcies, including the BlockFi and Genesis Global cases. <\/p>\n

If the government does not agree to prioritize FTX customers, its claims could significantly dilute the amount available to repay customers, FTX said. <\/p>\n

One group that will definitely be harmed by Bankman-Fried’s fraud are FTX investors and shareholders, who have little hope of recovering any money from the company’s bankruptcy, according to FTX. FTX will not have enough money to pay shareholders, who are last in line for repayment after the company’s customers, its lenders and the U.S. government.<\/p>\n<\/div>\n

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Crypto exchange FTX said it expects to negotiate U.S. government claims in its bankruptcy down to $3 billion to $5 billion, leaving no money for shareholders and contradicting a “reckless and false” claim by founder Sam Bankman-Fried that FTX’s collapse caused no harm. FTX revealed those estimates in court documents on Wednesday in response to […]<\/p>\n","protected":false},"author":2,"featured_media":6361,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"tdm_status":"","tdm_grid_status":"","fifu_image_url":"https:\/\/img.etimg.com\/photo\/88591548.cms","fifu_image_alt":"","footnotes":""},"categories":[607],"tags":[10162,10161,1289,7973,8064,10160,10159,10163,3390],"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts\/6360"}],"collection":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/comments?post=6360"}],"version-history":[{"count":1,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts\/6360\/revisions"}],"predecessor-version":[{"id":6362,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts\/6360\/revisions\/6362"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/media\/6361"}],"wp:attachment":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/media?parent=6360"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/categories?post=6360"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/tags?post=6360"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}