- The FTX debtors filed to repay the creditors in the same value as the time of collapse, which could deny them the notable gains made in 2023.
- The distressed crypto exchange is close to the final restructuring process that ensures an imminent relaunch in order to fully repay creditors and customers.
The distressed FTX customers and creditors have decided to formally fight the motion that seeks to deny them crypto profits registered last year. Recently, FTX submitted an estimation motion that dollarizes customer claims as of November 11 2022, when the crypto exchange filed for chapter 11 bankruptcy protection in the United States. Notably, the crypto exchange wants to reset the crypto prices to Bitcoin at $16,871, ETH at $1,258, and Solana (SOL) at $16.2. The estimation motion argued that the rest of the assets should be allocated to non-customer creditors including shareholders.
However, FTX customers have vehemently disagreed with the motion as it would be unfair considering the notable gains made by the respective crypto assets in the past year, especially SOL. The FTX customers wrote an objection to the motion directed to the presiding Judge Dorsey, indicating that the debtor’s arguments could lead to unfair compensation, thus should be denied. The FTX estate held about 10 percent of SOL’s total circulating supply, with the majority ready to be unlocked through 2028.
66 Objection letters have been filed by FTX creditors to debtors motion to dollarize claims (plan)
TOS: Clearly state customers retain ownership of the assets
Customers should be the first priority (crypto held in trust)
Enough assets to pay customers first before others pic.twitter.com/NcbVrSnfAQ— Sunil (FTX Creditor Champion) (@sunil_trades) January 10, 2024
What’s Ahead for FTX Crypto Exchange
The future of FTX is gradually shaping out with the court restricting process ensuring a fair process to the creditors and debtors. The FTX relaunch has sparked significant speculations from the crypto industry, thus helping the native token rally despite lacking intrinsic value. Furthermore, the current holders of FTT do not have any use case apart from mere speculation of the near future relaunch of FTX. Additionally, the US justice system has found SBF guilty of all the charges and now awaits the final sentencing.
Nonetheless, the reopening of the FTX exchange faces several hurdles including a tarnished reputation amid heightened competition in the web3 sector. Moreover, there are dozens of crypto exchanges led by Binance, Coinbase, and Gemini that have thrived through the 2022/2023 cryptocurrency bear market. Meanwhile, the distressed crypto exchange could benefit from the fast-growing web3 industry, its deep crypto liquidity, and the change of leadership. Notably, the appointment of John Ray III to facilitate the restructuring process has instilled confidence in the FTX crypto exchange.
FTT Market Outlook and Price Action
The FTX’s native token FTT has registered notable trading volume in the past few months in anticipation of the full relaunch of the distressed cryptocurrency exchange. As of this report, FTT token traded around $3.25, up about 20 percent in the past seven days. Notably, the FTT token has a fully diluted valuation of about $1 billion and an average 24-hour trading volume of around $133 million. The small-cap altcoin faces a steep hill climb ahead as its reputation has significantly been tarnished since its sudden collapse. Nonetheless, the company still holds a significant amount of valuable digital assets like Bitcoin, Ethereum, Solana, and stablecoins.
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