Creditors Propose Dollar Value for Claims on Defunct FTX Exchange Amid Market Surges
Summary:
Creditors for the collapsed FTX exchange have proposed a U.S. dollar value for cryptocurrency and fiat currency held by claimants. Using rates at the time of FTX's bankruptcy filing, they listed prices for around 500 digital and traditional assets. If approved, Bitcoin, Ether, and Binance Coin claims could fetch $16,871, $1,258, and $286 per coin, respectively. However, some crypto holders may miss out on potential gains, as Bitcoin and Ether's prices have surged since the collapse. A court hearing on the issue is scheduled for January 25.
Creditors for the now-defunct FTX cryptocurrency exchange have revealed a proposed U.S. dollar value for cryptocurrency and fiat currency held by claimants. Submitted on December 27 to the United States Bankruptcy Court for the District of Delaware, the communication from FTX's creditors proposed a "sensible and just value" for user claims at the moment the exchange failed in November 2022. Around 500 asset prices in digital and traditional currency were identified in the proposal, using the rates at the time of FTX's bankruptcy announcement.
According to the proposed framework, Bitcoin (BTC) claims could fetch $16,871 per coin, Ether (ETH) would be valued at $1,258, and Binance Coin (BNB) at $286. Included in the table were prices for leveraged tokens, tokenized stocks, spot derivatives, and crypto futures, but the estimated FTX Token (FTT) price wasn't specified.
The creditors' filing highlighted the court's considerable latitude in determining the best method for estimating valuations of claims based on digital assets. While the court doesn't aim to provide precise calculations, it considers all factors and circumstances surrounding claims. They further clarified that the plan involves converting the digital asset's value into cash on the filing date using the figures in the Digital Assets Conversion Table, and making cash distributions.
The filing mentioned Coin Metrics data was the source for digital assets pricing estimation. Parties associated with the bankruptcy case have until January 11 to lodge objections, with a hearing planned for January 25 on this issue.
Despite the proposed plan, several FTX users expressed their disappointment. Since the collapse of the exchange in November 2022, clients have been unable to access their funds. However, some have managed to offload their claims to third parties at a lower value. Following the court approval of the plan, some crypto holders would miss the opportunity of capitalizing on certain token gains. Since FTX's downfall, Bitcoin's price has soared more than 150% to hit $42,452 at publication time. Similarly, Ether's price has jumped over 87%, from $1,258 to $2,354.
Published At
12/28/2023 10:12:36 PM
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