FTX’s Road to Recovery: Challenges and Opportunities Ahead
There was some premature celebration on Crypto Twitter after an FTX lawyer's comments during a bankruptcy hearing were misinterpreted.
While the lawyer revealed that FTX had recovered $7.3 billion in cash and liquid crypto assets, including $2 billion in cash and $4.3 billion in “liquid” cryptocurrencies, this doesn’t mean the company has nearly all its funds back or is close to restarting.
“Liquid” refers to tokens with a market capitalization of $15 million and $1 million in daily volume over a month.
It’s worth noting that a market cap of $15 million would place a coin at around 700th on CoinMarketCap, indicating that selling some of these assets may be challenging.
FTX is currently evaluating whether restarting the exchange is feasible but warned that it would require significant capital from asset sales or external funding. The existing app was described as a “facade.”
FTX aims to complete its assessment of the viability of relaunching the exchange by Q2 2023.
READ MORE: FTX’s European Operations up for Sale Amid Cryptocurrency Chaos
The FTX debtors aim to file a Channel 11 Target Plan next quarter, but confirmation of the plan isn’t expected until Q2 2024.
In previous statements, the FTX debtors have revealed that the exchange had few internal controls, with decision-making authority resting with CEO Sam Bankman-Fried (SBF), who is facing 12 felony charges related to the FTX fraud, as well as civil charges from the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC).
SBF has pleaded not guilty, but some of his co-conspirators, including Caroline Ellison and Gary Wang, have pleaded guilty to charges related to the fraud.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
