In this article, we will explore, the recent rumours circulating around on twitter about FTX starting to liquidate their remaining funds to pay back to debtors. Is there any truth to this and what do these rumours consist of? Fid out in this article
FTX previously ranks among the globe’s major cryptocurrency exchanges, facilitating the exchange of digital currencies for either other digital currencies or conventional currency and the reverse process. Situated in the Bahamas, it was under the leadership of Sam Bankman-Fried and invested substantial sums in advocating for crypto-friendly regulatory measures among U.S. lawmakers.
FTX declared bankruptcy on November 11, 2022, following a sharp increase in customer withdrawals in the preceding month. The former CEO, Sam Bankman-Fried, acknowledged that the company lacked adequate reserves to fulfil customer demands.
Sins filing for bankruptcy a whole saga has unfolded that is worthy of an article itself, but recently fears have arose surrounding impending liquidations of FTX’s currently holdings rumoured to take place from the 13th of September onwards.
FTX had in April funds to the tune of $3.4 billion this was in:
- Solana $SOL $685,000,000
- FTX Token $FTT $529,000,000 (very unlikely there is anywhere near this amount still in value in FTT token)
- Bitcoin $BTC $268,000,000
- Ethereum $ETH $90,000,000
- Aptos $ATP $67,000,000
- Dogecoin $DOGE $42,000,000
- Polygon $MATIC $39,000,000
- $BIT $35,000,000
- Toncoin $TON $31,000,000
- $XRP $29,000,000
- Mixed (a basket of claims and other assets) $1.271 Billion
Its very unlikely that this is still the current value placed on FTX’s crypto holding, however we await official word on the value of funds available to be liquidated. Solana recently has fallen in price significantly dispute the recent visa announcement.
I would like to address once again the facts that this hasn’t come from FTX’s legal team officially, just the rumours that are currently doing the rounds on twitter, however their has been official statements recently that may lead one to believe the liquidations of FTX’s funds to pay back debtors isn’t too far a away.
Recent developments with FTX in the bankruptcy process:
After a court filing sought the appointment of a liquidator with the authority to sell up to $100 million worth of assets weekly, a tweet from the official FTX Twitter account has sparked concerns among investors.
On the 6th of September 2023, the official FTX account, which is seldom utilized, posted a tweet stating that the company has been actively facilitating the transfer of tokens between different blockchains back to their respective native chains.
Are they mobilizing funds to sell or just trying to project their holdings from further damage, right now there are no on-chain evidence that sales of FTX’s funds have begun at scale.
so far no official announcement of starting to sell funds or update on the current value of the funds can be found. So we await comment from official channels, however it does seem an inevitability that the funds under FTX do eventually get liquidated. The real question is how is this done, the least likely way is on the open market through exchanges, the two most notable Binance and Coinbase currently both in battles with the SEC (security and exchange commission). Selling any real volume would likely reduce, especially now wit no volume on exchanged the price of the assets they seek to cash out. this would be counter productive and costly. its far more likely a OTC (over the counter deal) takes place.