Sam Bankman-Fried, co-founder of FTX cryptocurrency derivatives exchange, arrives in a New York courtroom on Thursday, February 16, 2023.
Yuki Iwamura | Bloomberg | Getty Images
Nearly all customers of collapsed cryptocurrency exchange FTX will get their funds back — and more, according to court documents.
FTX estimates it owes creditors about $11.2 billion, according to a restructuring plan released late Tuesday. FTX said it has $14.5 billion to $16.3 billion available to distribute to creditors.
Customers with claims of $50,000 or less will receive about 118% of their allowed claim amount, the plan said. About 98% of creditors will receive this compensation.
The reorganization plan, which still requires bankruptcy court approval, could bring some relief to FTX customers whose funds have been locked up at the exchange since it filed for bankruptcy in November 2022.
FTX’s high-profile founder Sam Bankman-Fried was found guilty of seven criminal counts in early November, including charges related to stealing billions of dollars from FTX customers. He was sentenced to 25 years in prison.
FTX raised money by selling a slew of assets, including venture capital investments held by the exchange and other investments held by Bankman-Fried’s crypto hedge fund Alameda.
One of FTX’s most high-profile investments is in Amazon-backed artificial intelligence company Anthropic. FTX sold a majority stake in Anthropic this year, making nearly $900 million.
FTX has to find other ways to raise funds because the exchange lacks a large number of cryptocurrencies.
“As a result, in a Chapter 11 case, the debtor cannot benefit from the appreciation in the value of these missing tokens. Instead, the debtor is forced to find other sources of recoverable value to repay creditors,” FTX said in a press release on Wednesday.
Since November 2022, cryptocurrency prices have increased significantly. Bitcoin Since FTX filed for bankruptcy protection, shares are up about 270%.
After Bankman-Fried stepped down, FTX appointed John Ray III as CEO. Ray said of FTX in November 2022 that “in his 40 years of legal and restructuring experience,” he had never seen “such a complete failure of corporate control and such a complete lack of credible financial information occurring here.” .
“We are pleased to be able to propose a Chapter 11 plan that contemplates returning 100% of the bankruptcy claim amount plus interest to non-governmental creditors,” Wray said in a statement Wednesday.
— CNBC’s MacKenzie Sigalos contributed to this report.
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