FTX Update: Abandons Relaunching Platform, Judge Approves Repaying Customer Assets Using "Bankruptcy Price"

According to yesterday's court hearing, the bankruptcy restructuring team of FTX stated that they have abandoned plans to relaunch the platform. The bankruptcy judge also dismissed clients' complaints about the liquidation coin price, allowing FTX to repay customer assets at the price from the time of bankruptcy. Subsequently, FTX's native token FTT dropped by 15.5%.

FTX Abandons Efforts to Restart Its Crypto Exchange

According to a report by Reuters, FTX lawyer Andy Dietderich stated at a bankruptcy court hearing in Delaware that FTX has been in negotiations with potential bidders and investors for several months, but no one was willing to invest enough funds to rebuild the FTX exchange.

Dietderich stated that the failed negotiations highlighted a fact:

FTX was never what it appeared to be. Founder SBF never built the foundational technology or management necessary to run a company. FTX was a reckless scam created by a convicted felon, using things SBF threw in the garbage to create a viable exchange, which was too costly and risky in both expenses and risks!

Judge Approves FTX to Repay Customer Assets with 2022 Coin Prices

Therefore, FTX will focus on liquidating its assets to repay customers whose cryptocurrencies were locked up when the company filed for bankruptcy in November 2022.

Dietderich stated that FTX has recovered over $7 billion in assets and expects to distribute the full amount to all customers. However, it will calculate the repayment amount based on cryptocurrency prices since November 2022, when the cryptocurrency market was in a prolonged slump, with Bitcoin priced at just $16,000, more than double the current price of $42,000.

FTX creditors received a letter from Kroll? Total table of conversion claims: BTC 16K/ETH 1.2K/SOL 16/FTT not counted

Although dozens of FTX customers raised objections, U.S. bankruptcy judge John Dorsey rejected these customer complaints at a hearing on Wednesday, approving FTX's use of 2022 prices, stating:

I have no discretion in this, U.S. bankruptcy law is very clear, debts must be repaid based on the value at the time the company filed for bankruptcy, and I am obligated to adhere to it.

FTX also stated that customers should not expect quick repayments as the company still needs to investigate which customer claims are legitimate.

FTT Drops 15%

FTX's native token FTT briefly surged to $3.25 after the company's news broke, but then plummeted significantly, trading at $2.2793 at the time of writing, representing a 15.5% decrease in the past 24 hours.