FTTUSDT Archives

8th May 2024

FTT Surges 50% On FTX Creditors’ Claims Settlement And Billions In Compensation: How High Can It Rise?

In a significant development, defunct cryptocurrency exchange FTX has unveiled a reorganization plan to reimburse almost all of its customers.

The announcement has sparked a substantial surge in the exchange’s native token, FTT, which recorded an uptrend of 52% over the past seven days, reaching a monthly high of $2.29 during Wednesday’s early trading session.

FTX Unveils Debt Repayment Strategy

FTX estimates its outstanding debts to creditors to be approximately $11.2 billion, as revealed in the reorganization plan published late Tuesday. The company has disclosed that it possesses between $14.5 billion and $16.3 billion, which it intends to distribute among the creditors.

Under the proposed plan, customers with $50,000 or less claims will receive approximately 118% of the allowed claim amount. This compensation is slated to be disbursed to around 98% of the creditors, relieving FTX customers who have experienced locked funds since the exchange filed for bankruptcy protection in November 2022.

FTX stated in a press release on Wednesday that the company could not utilize the appreciation of the missing tokens during the Chapter 11 cases. Instead, FTX had to identify other recoverable sources of value to repay creditors.

Following the departure of founder Sam Bankman-Fried, FTX appointed John Ray III as CEO. Ray, speaking on the matter in November 2022, expressed his astonishment at the “complete failure of corporate controls and such a complete absence of trustworthy financial information” witnessed at FTX. Ray further stated in the press release on Wednesday:

We are pleased to be in a position to propose a Chapter 11 plan that contemplates the return of 100% of bankruptcy claim amounts plus interest for non-governmental creditors.

FTX’s founder, Sam Bankman-Fried, faced legal consequences, being convicted on seven criminal counts, including charges related to embezzling billions of dollars from FTX’s customers. Bankman-Fried was subsequently sentenced to 25 years in prison.

FTT Bulls Eyeing $2.55 For Potential Breakout Continuation

As of the latest update, the price of FTT has corrected to $2.050 after reaching its monthly high. This breakout occurred after consolidation between the $1.17 and $1.48 levels.

At the current price level, FTT faces a significant resistance at $2.169, which has led to the ongoing correction. If FTT sustains its bullish momentum, the next resistance level to watch is $2.55 in the token’s daily chart.

A successful breakthrough of this level could potentially lead to a retest of the $3 mark, which has not been revisited since January.

On the other hand, if the price experiences a further correction, FTT bulls should closely monitor the $1.95 and $1.765 levels, as they serve as crucial support levels. It is essential to prevent a loss of the gains achieved over the past month, which amounts to an 18% increase during this period.

FTX

Featured image from Shutterstock, chart from TradingView.com

25th April 2024

FTX Co-Founder Sam Bankman-Fried’s Civil Liability Released In Settlement With Investors

According to a recent Bloomberg report, a group of investors and customers of cryptocurrency exchange FTX have agreed to drop their claims against co-founder Sam Bankman-Fried.

In exchange, Bankman-Fried has agreed to cooperate with the plaintiffs in the ongoing lawsuits against other defendants related to the collapse of FTX.

Sam Bankman-Fried And Insiders Settle

Per the report, if approved by a judge, this agreement would release Bankman-Fried from civil liability just weeks after being sentenced to 25 years in prison for fraud stemming from allegations of stealing billions of dollars from FTX.

The settlement, filed in federal court in Miami, stipulates that the plaintiffs in the multi-district litigation will resolve all current and future claims against Bankman-Fried.

Other FTX insiders, including former executives Gary Wang, Caroline Ellison, and Nishad Singh, who testified against Bankman-Fried, were also sued by investors. However, they have agreed to settle and have already started providing information to support the plaintiff’s case, as stated in the court filing.

Notably, this leaves the high-profile celebrities, sports stars, and social media influencers who promoted FTX to investors and customers as the remaining defendants.

As part of the settlement agreement, Bankman-Fried has committed to assisting the plaintiffs’ lawyers in pursuing the remaining FTX endorsers. Additionally, he will provide all nonprivileged documents related to his assets and his investment in artificial intelligence start-up Anthropic.

Bankman-Fried will also submit an affidavit certifying his net worth as negative and share documents about other defendants involved in the expansive civil litigation.

The list of defendants in the consolidated FTX lawsuits is extensive, with financiers and celebrity endorsers such as Tom Brady, Shaquille O’Neal, and Gisele Bundchen accused of promoting “unregistered securities” and luring investors into a Ponzi scheme.

Bankman-Fried’s agreement includes providing any relevant information about venture capital firms that invested in FTX and accountants and lawyers who worked with the exchange.

If successful, the plaintiffs could potentially win substantial amounts in damages. According to court filings, the settlements with the promoters involved in the agreement are estimated to be valued at around $1.3 million.

FTX Scandal Update

Bankman-Fried’s spokesperson, Mark Botnick, stated that his client is determined to make amends. Botnick emphasized that since the collapse of FTX, Bankman-Fried has focused solely on returning the estate’s assets to customers and ensuring they are made whole at current prices.

Botnick expressed Bankman-Fried’s commitment to continue working with Adam Moskowitz and his team, representing the plaintiffs, to achieve this goal.

In their request for the judge’s approval of the settlement, the plaintiffs’ attorneys acknowledged the uncertainty and litigation risks associated with pursuing Bankman-Fried. They concluded that Bankman-Fried’s cooperation would be “valuable” in the remaining legal proceedings.

Bankman-Fried, who was found guilty at trial late last year and sentenced in late March, is currently in custody at the Metropolitan Detention Center in Brooklyn, New York, before being transferred to the prison where he will serve his term. He intends to appeal both his sentence and conviction.

FTX

Featured image from Reuters, chart from TradingView.com

12th April 2024

FTX Co-Founder Sam Bankman-Fried Appeals 25-Year Conviction And Makes Unusual Request

In a dramatic turn of events, Sam Bankman-Fried, the founder of the now-defunct cryptocurrency exchange FTX, has been sentenced to 25 years in prison for defrauding users.

The judgment was handed down by US District Judge Lewis Kaplan during a hearing in a Lower Manhattan federal courtroom on March 28.

Bankman-Fried, who had publicly announced plans to appeal the conviction, has now officially filed an objection to the decision.

‘Remorse And Empathy’ For FTX Customers

During the sentencing hearing, US District Judge Lewis Kaplan leveled serious accusations against Bankman-Fried, including perjury and evasiveness during his testimony. The judge expressed disappointment in Bankman-Fried’s lack of regret for the crimes committed.

In response, Bankman-Fried expressed remorse and empathy for the “thousands of customers” who suffered financial losses. He acknowledged his responsibility as CEO of FTX and expressed desire to repair the damage caused.

Bankman-Fried expressed frustration at the loss of what he had achieved and his limited ability to improve the situation from prison. Despite his efforts, he acknowledged the constraints that limited his ability to do more.

Sam Bankman-Fried Alleges Trial Unfairness

In a post-conviction interview, Bankman-Fried expressed concerns about the fairness of his trial, specifically targeting Sullivan & Cromwell, the law firm representing FTX’s new owners.

The disgraced FTX co-founder accused the law firm of colluding with the prosecution and obstructing his access to key FTX documents shared with the prosecution. Bankman-Fried claimed that this had a detrimental effect on the entire trial, including media coverage and the defense’s ability to present evidence in his favor.

With the official appeal now filed, Bankman-Fried is seeking a different outcome, hoping for a reduced sentence. He emphasized the importance of introducing crucial evidence and presenting key witnesses, which he claims his defense was denied the opportunity to do during the trial.

Currently being held at the Metropolitan Detention Center in Brooklyn, Bankman-Fried has been particularly vocal about his desire to remain in the MDC-Brooklyn jail pending the outcome of his appeal.

As this high-profile case unfolds, the crypto mogul’s quest for a different outcome and the damage caused by FTX’s collapse continue to captivate public attention.

Future actions by the US government in response to this appeal, as well as subsequent legal actions and filings by Bankman-Fried’s legal team, are yet to be determined.

Sam Bankman-Fried

Presently, the native token of the exchange, FTT, is trading at $1.60. Notably, the token has experienced a noteworthy 4% price increase within the last 24 hours, distinguishing it from the overall trend of sideways price movement or declines observed across the cryptocurrency market.

However, it is important to note that the token has witnessed a decline of 32% over the past month, which has considerably diminished FTT’s year-to-date surge, currently standing at 25%.

Featured image from iStock, chart from TradingView.com

2nd April 2024

FTX Founder Sam Bankman-Fried Breaks Silence, Announces Appeal For 25-Year Conviction

In a recent interview with ABC News, Sam Bankman-Fried (SBF), the co-founder and former CEO of the now-bankrupt cryptocurrency exchange FTX, spoke about his remorse and plans for an appeal following his recent 25-year prison sentence for fraud.

FTX Co-Founder Admits Errors

Bankman-Fried, currently held at the Metropolitan Detention Center in Brooklyn, shared his reflections on the unfolding events. He admitted to making several “bad decisions” in 2022 that led to FTX’s insolvency.

Although he claimed he had never considered his actions illegal, Bankman-Fried acknowledged falling short of the “high ethical standard” he set for himself.

During the sentencing, US District Judge Lewis Kaplan accused Bankman-Fried of perjury and evasiveness during his testimony, criticizing his lack of remorse for the crimes committed. In response, Bankman-Fried affirmed his remorse and expressed empathy for the thousands of customers who suffered financial losses. SBF claimed the following:

I’m haunted, every day, by what was lost. I never intended to hurt anyone or take anyone’s money. But I was the CEO of FTX, I was responsible for what happened to the company, and when you’re responsible it doesn’t matter why it goes bad. I’d give anything to be able to help repair even part of the damage. I’m doing what I can from prison, but it’s deeply frustrating not to be able to do more

Bankman-Fried also acknowledged the impact on his co-workers, who reportedly dedicated their lives to FTX, and the charities he supported, whose funding was affected by the company’s collapse.

The disgraced crypto mogul expressed deep regret for “throwing away” what they had worked hard for and expressed a desire to repair at least part of the damage caused. Despite his efforts from prison, Bankman-Fried admitted to feeling frustrated by the limitations on what he could do to rectify the situation.

In his statement to the court, Bankman-Fried contended that if he or another FTX employee had remained CEO, customers would have been paid back by now. He attributed the delay in compensation to the company’s decision not to restart the FTX exchange, which he believed could have created long-term value.

Sam Bankman-Fried Claims ‘Unfair’ Trial, Plans Appeal

During the interview, Bankman-Fried also raised concerns about the fairness of his trial, specifically calling out Sullivan & Cromwell, the law firm representing FTX’s new owners.

SBF accused them of colluding with the prosecution and preventing him from accessing key FTX documents shared with the prosecution. Bankman-Fried claimed this had a “detrimental effect” on the entire trial, including media coverage and the defense’s ability to present evidence in his favor.

Responding to Bankman-Fried’s claims, a spokesperson for Sullivan & Cromwell referred to Judge Kaplan’s sentencing remarks, highlighting Bankman-Fried’s perjury on the witness stand and his strategy of blaming lawyers and the bankruptcy process instead of accepting responsibility for his crimes.

Looking ahead, Bankman-Fried revealed that his defense team plans to appeal the conviction later this year, primarily based on certain trial testimony that he felt greatly misrepresented the actual events. He also mentioned the importance of introducing “crucial evidence” and presenting key witnesses, which his defense was allegedly not allowed to do during the trial.

As Bankman-Fried begins his prison term, he acknowledges the gravity of the situation, having lost everything. While expressing a desire to make a positive difference in the world, he recognizes the limitations of his current circumstances and remains committed to seeking justice through appeals.

Sam Bankman-Fried

Featured image from BBC News, chart from TradingView.com

28th March 2024

BREAKING: Sam Bankman-Fried Sentenced To 25 Years In Prison

In a highly anticipated courtroom verdict, Sam Bankman-Fried, the founder of the collapsed cryptocurrency exchange FTX, has been sentenced to 25 years in prison for defrauding users. US District Judge Lewis Kaplan delivered the judgment during a Lower Manhattan federal courtroom hearing.

FTX Founder Sam Bankman-Fried Sentenced

Judge Kaplan sternly criticized the defense’s argument, labeling it as “misleading, logically flawed, and speculative.” As reported by our sister site, Bitcoinist, Kaplan highlighted Bankman-Fried’s obstruction of justice and witness tampering during his defense, which were significant factors considered in the sentencing decision.

Bankman-Fried expressed remorse in a statement, acknowledging that his series of “selfish” decisions as the leader of FTX had led to the exchange’s downfall. He admitted to having “thrown it all away” and expressed regret that continues to haunt him daily.

Prosecutors had initially sought a maximum sentence of 50 years, while Bankman-Fried’s legal team argued for a maximum of 6 years. In November, Bankman-Fried was found guilty on seven criminal counts, and he has since been held at the Metropolitan Detention Center in Brooklyn.

Life Plans Shattered

Late Tuesday, prosecutors submitted documents containing testimonies from victims, shedding light on the impact of Bankman-Fried’s actions. One victim, whose name was redacted, wrote a letter dated March 15, describing the destruction of their entire life and the emotional toll it had taken on their family.

They emphasized that they had entrusted their funds to FTX as a custodian, not consenting to the risks Bankman-Fried had taken with their money. The victim shared the suffering that had led to depression and even thoughts of suicide.

During the trial, prosecutors revealed that Bankman-Fried had diverted funds from FTX customers, amounting to as much as $8 billion. These funds were allegedly used to finance a wide range of external interests, including political initiatives, speculative investments, and funding the lifestyles of FTX executives.

Sam Bankman-Fried

Featured image from Shutterstock, chart from TradingView.com

28th March 2024

BREAKING: Sam Bankman-Fried Sentenced To 25 Years In Prison

FTX Founder Sam Bankman-Fried Sentenced

Life Plans Shattered

Sam Bankman-Fried

Featured image from Shutterstock, chart from TradingView.com

6th February 2024

FTT Crashes 30% As FTX Relaunch Hopes Fade: Is the Dream Over?

The dream of a revived FTX exchange evaporates, triggering a massive sell-off of its native token, FTT. According to Kaiko, on February 5, FTT, the now utility-free currency of the defunct exchange, plummeted over 30% last week, erasing much of its recent gains fueled by speculation of an FTX comeback.

FTT price collapse | Source: Kaiko via X

FTX Won’t Resume Operations

The worrying drop follows reports that the bankrupt exchange, once led by Sam Bankman-Fried, is unlikely to resume operations. Notably, the news comes despite a glimmer of hope for FTX customers.

At a recent court hearing, the exchange’s representatives claimed it expects to repay its users fully. However, repayments would be based on the worth of their assets during FTX’s bankruptcy.

It should be noted that by the time FTX went bankrupt in late 2022, crypto assets were at the last phase of a bear market, with prices plunging to multi-month lows. Bitcoin, the world’s largest crypto asset, was trading below $20,000. After FTX collapsed, prices crashed below $16,000 before bouncing back strongly.

Following a court hearing in late January, FTX lawyer Andrew Dietderich, in a now-deleted YouTube video, said the exchange wouldn’t be looking to relaunch due to the absence of buyers. For this reason, the exchange is looking at allowing creditors to obtain approvals from investors seeking repayments.

Claimants impacted, given the new conditions and trajectory the exchange plans to take, have to provide sufficient proof that they held assets in FTX before it collapsed.

This new detail raises concerns for thousands, if not hundreds of thousands, of claimants, who argue that the actual value of their assets lies at the pre-crash level. On average, Bitcoin and top coins were roughly double digits higher than the November 2022 lows.

FTT Is Free Falling, Reverses November Gains

For the better part of 2023, FTT prices recovered steadily. To demonstrate, since November 2023, FTT prices have risen by over 300%. The encouraging surge was fueled solely by the possibility of FTX 2.0 launching and implementing a new management model.

With that hope fading, FTT appears to be facing a harsh reality check. Questions about its utility are being asked since FTT served as a critical cog in the FTX ecosystem when the exchange operated normally.

When writing on February 5, FTT changes hands at around $1.7. Looking at price charts, bears are in control, completely reversing the gains of November 2023. As it is, $0.95 remains to be a key support line.

13th December 2023

FTX And IRS Lock Horns Over $24 Billion Tax Bill, FTT’s Key Support Wavers

In a striking turn of events, the Internal Revenue Service (IRS) in the United States has presented a staggering tax bill of $24 billion against the bankrupt cryptocurrency exchange FTX.

FTX Challenges IRS’s $24 Billion Tax Bill

According to court filings and FTX’s response to the IRS’s claims, several key arguments challenge the basis of the tax bill. Firstly, FTX highlights that its operations spanned three years, never distributing dividends or earnings.

Secondly, the exchange’s defense attorneys claim that the company incurred substantial losses rather than generating income that could support the IRS’s “exorbitant” tax claim.

Thirdly, the lawyers argue that FTX is currently in liquidation and is not engaged in any ongoing business activities apart from those required for the liquidation process.

Finally, the company emphasizes that the recovery sought by the IRS would ultimately come at the expense of FTX’s victims, as the funds would be redirected away from their rightful recipients.

As the court hearing approaches, FTX asserts that proceeding with a court-supervised estimation process would demonstrate the company’s significant losses during its operational period, rendering the IRS’s claim “baseless.”

FTX emphasizes that any forced payment would harm the victims of the FTX fraud, many of whom are already grappling with “profound losses.”

FTX’s administrators have managed to recover approximately $7 billion in assets, including $3.4 billion in cryptocurrencies. These figures underscore the complex financial landscape surrounding the IRS’s claim against FTX.

As the courtroom showdown ensues, the case outcome will undoubtedly have significant implications for the future of crypto taxation and the recovery prospects of FTX’s creditors.

FTT’s Bullish Trend Holds Strong

As the cryptocurrency market experiences a significant correction following a bullish surge led by Bitcoin (BTC), FTX’s native token, FTT, has seen a decline of over 5% in the past 24 hours, adding to the company’s legal concerns.

After a three-month accumulation phase that kept FTT trading in a range between $0.9 and $1.2 from September to the beginning of November, the token witnessed an impressive surge in the last month, reaching its highest price of the year at $6.042, a level not seen since November 2022.

However, the token has retraced to its current price mark of $4.8, with the next support level at $4.45 in case of further downward movement.

On a positive note, FTT is trading above key moving averages, including the 200-day and 50-day MA, which provide support and indicate the potential for further upward price action.

Furthermore, since the beginning of November, FTT has consistently recorded higher highs and higher lows, forming an uptrend pattern. This trend has been observed three times, with the token experiencing an uptrend, followed by a pullback for a support test, and then a continuation to reach new highs.

Assuming this trend continues and the legal developments do not have a significant impact on the price of the token, FTT may be poised for a significant rise in the coming months, given the remarkable uptrend pattern seen on the daily chart.

Featured image from Shutterstock, chart from TradingView.com

1st December 2023

Disgraced FTX Co-Founder Placed On Suicide Watch In Prison, Reveals Former Inmate

Sam Bankman-Fried, the co-founder of the FTX crypto exchange, who was recently found guilty of multiple counts of criminal fraud, reportedly faced a harrowing experience while incarcerated.

According to a former mobster turned federal informant, Gene Borrello, who shared a prison cell with Bankman-Fried, the disgraced crypto executive was placed on suicide watch and endured challenging conditions during his time at Brooklyn Metropolitan Detention Center (MDC) while awaiting sentencing next year.

FTX Co-Founder Subjected To Extortion

The details emerged during an interview with crypto blogger Tiffany Fong, where Borrello disclosed the troubling circumstances surrounding Bankman-Fried’s imprisonment.

The former detainee recounted how Bankman-Fried was subjected to suicide watch, extortion attempts, and even periods of self-neglect, including refusing to eat or shower for several days.

In an attempt to protect Bankman-Fried from potential harassment or extortion, authorities segregated him from gang members within the prison facility. However, despite these precautions, Borrello’s intervention reportedly foiled an extortion plot against the crypto mogul.

Borrello further revealed that he prevented the extortionists from coercing Bankman-Fried into sharing a bunk with them, placing the FTX co-founder in a solitary wing. Additionally, Bankman-Fried’s parents reportedly requested his transfer to the solitary unit to ensure his safety.

Drastic Change In Prison?

Describing the physical and emotional toll on Bankman-Fried, Borrello highlighted the crypto executive’s frail appearance, likening it to that of an elderly man. Borrello stated on the matter:

He has the body of an 80-year-old man. He has, like, no shape to him. When he talks to you, he puts his head down; he’s very timid, he talks very nervously.

Borrello also noted Bankman-Fried’s timid demeanor, with the co-founder displaying signs of nervousness during interactions.

In one conversation, Borrello confronted Bankman-Fried, stating that he had never been in a physical altercation before and questioned his association with gang members.

As reported by our sister site, Bitcoinist, Bankman-Fried received unique treatment in prison, where he allegedly received special privileges for sharing cryptocurrency-related information with prison guards and fellow inmates.

However, Borrello’s account offers a contrasting perspective, emphasizing the challenges and vulnerabilities the disgraced executive faced behind bars.

As Bankman-Fried’s sentencing approaches, his time in prison, including allegations of bullying and the ultimate impact on his legal proceedings, continues to draw attention.

The revelations from Borrello’s interview provide a rare glimpse into the world of the disgraced FTX co-founder, and it remains to be seen what other revelations may be made in prison for Bankman-Fried as his sentencing trial looms in 2024.

At present, the native token of FTX, FTT, is trading at $4.0997, indicating a decrease of 2.8% in the past 24 hours. However, it is noteworthy that the token has experienced a substantial surge of 216% year to date.

Featured image from Shutterstock, a chart from TradingView.com

23rd November 2023

From Crypto To Catch: Disgraced FTX Founder Turns To Trading Fish In Prison

According to a report by Business Insider, Sam Bankman-Fried (SBF), co-founder and former CEO of FTX, has adapted to the economic system of New York’s Metropolitan Detention Center (MDC), where he is currently awaiting sentencing on multiple felony counts.

The disgraced crypto-billionaire has reportedly been bartering, using food as currency in exchange for various services within the prison.

Former FTX CEO SBF Trades Fish For Services

Per the report, mackerel, a fish commonly referred to as “macks” among inmates, emerged as the currency of choice in federal prisons after cigarettes were banned. The fish’s popularity stems from its stability and value within the prison economy.

Formerly incarcerated individuals like attorney Larry Levin have accepted mackerel as payment from fellow prisoners, using it to acquire services such as beard trims and shoe shines.

The demand for mackerel became so significant that suppliers, including Global Source Marketing, witnessed increased sales, according to Business Insider.

In a prison environment where inmates lack access to traditional or digital currency, products with steady value, such as certain food items and stamps, serve as substitutes for money.

Mackerel and other stable commodities like tuna become a means of exchange, with their value pegged to the dollar. This economic logic allows inmates to engage in various transactions while maintaining a semblance of a barter system.

The use of fish as a medium of exchange in federal prisons has been widespread since 2004, following the cigarette ban.

Sam Bankman-Fried faces sentencing on March 28, 2024, for charges that include wire fraud and conspiracy to commit money laundering, with a potential prison term of up to 110 years. Additionally, SBF is set to stand trial for separate counts related to political bribery.

FTT Surges with Impressive Gains

FTT, the native token of the FTX cryptocurrency exchange, has seen a remarkable surge in value in recent weeks. With substantial gains across various timeframes and an impressive market capitalization of 1.5 billion, FTT has cemented its position among the top 50 tokens in the crypto market.

Over the past 24 hours, FTT has experienced a significant increase of 21%, showcasing the token’s upward momentum. This short-term surge is complemented by a strong performance over the past week, with a notable rise of 26%.

However, the real standout lies in FTT’s gains over the past 14 and 30 days. Within the last two weeks, FTT has skyrocketed by an impressive 100%, while the 30-day timeframe has seen an astounding surge of 315%.

These gains highlight the growing demand and investor interest in FTT as rumors of a possible reboot of the exchange circulate within the crypto community.

Featured image from Bloomberg, chart from TradingView.com

15th November 2023

Is Buying FTT Now A Once-In-A-Life Opportunity For FTX Believers?

FTT, the native token of the FTX ecosystem, rallied by 180% last week, emerging as one of the top performers. The rally, Kaiko, a blockchain analytics platform observes, was primarily due to comments by the stringent United States Securities and Exchange Commission (SEC) leader that the FTX 2.0 relaunch is possible.

FTT Soaring On Hopes Of FTX Relaunching

In an X post on November 14, Kaiko also notes that related FTT trading volume soared, signaling possible accumulation by traders and believers of FTX. At spot rates, FTT trading volume, looking at how the token performs in Binance, one of the leading cryptocurrency exchanges, remains elevated at November 2022 levels.

FTT trade volume and price | Source: Kaiko on X

In November 2022, FTX, led by Sam Bankman-Fried, filed for Chapter 11 bankruptcy protection at the United States Bankruptcy Court for the District of Delaware.

Before this bankruptcy filing, FTT, which served several purposes in the FTX ecosystem, acting as a governance token and providing access, plunged in early November following allegations that the exchange had misappropriated user funds. There was a significant collapse on November 8 when FTT fell by 90%, taking the coin from around $22 to as low as $2.

FTT is trading at around $3.22, up 232% from October 2023 lows, looking at the performance in the daily chart. As fundamental events around FTX unfold, FTT’s trading volume also rises.

Compliance With The Law Is Crucial: SEC Chairperson

There could be more gains for FTX in the days ahead should there be more solid news of an FTX 2.0 relaunch following Gary Gensler’s comments last week. Then, Gensler told CNBC that a revived FTX could see the light of day if only leaders taking over clearly understood existing laws.

The SEC chairperson’s comments follow speculations that the former New York Stock Exchange (NYSE) president, Tom Farley, is among the three bidders planning to buy FTX.

“If Tom or anybody else wanted to be in this field, I would say, ‘Do it within the law. Build investors’ trust in what you’re doing and ensure that you’re doing the proper disclosures — and also that you’re not commingling all these functions, trading against your customers. Or using their crypto assets for your purposes.”

A jury in early November found Sam Bankman-Fried, the former CEO of FTX, guilty of all criminal charges, including wiring fraud and money laundering. Bankman-Fried is set for sentencing in March 2024.

26th October 2023

FTX Ramps Up Restitution Efforts, Subpoenas AI Firm CAIS Over $6.5M Investment

Bankrupt crypto exchange FTX, led by newly appointed CEO John Ray III, has embarked on an intensive legal campaign to regain control and recover assets in its pursuit of financial restitution.

As founder Sam Bankman-Fried awaits possible conviction and faces a staggering 114 years in prison if found guilty, FTX’s asset recovery plan continues under Ray’s leadership.

FTX Bankruptcy Battle Escalates

In a recent filing with the US Bankruptcy Court for the District of Delaware, FTX issued a subpoena to the artificial intelligence (AI) firm Center for AI Safety (CAIS), demanding accounting records and information regarding payments, agreements, and contracts related to the $6.5 million investment.

The motion, filed on behalf of the debtors who sought Chapter 11 bankruptcy protection on November 11 and November 14, 2022, states that the Debtors are operating their businesses and managing their properties as debtors-in-possession under the Bankruptcy Code.

It also highlights the appointment of an Official Committee of Unsecured Creditors by the US Trustee. FTX’s investigations have revealed that CAIS received transfers totaling at least $6.5 million in debtors’ funds between May and September 2022.

As part of their ongoing efforts to understand the debtors’ financial landscape, transactions, and estate, FTX has requested CAIS to produce relevant documents and information related to payments, agreements, communications, and other pertinent details.

Debtors Seek Answers

According to the motion filed on October 25, despite the debtors’ attempts to engage in a cooperative dialogue and resolve the matter amicably, CAIS has rejected voluntary requests for accounting and failed to respond to formal correspondence. The filing reads:

The Debtors have attempted to engage in a cooperative meet and confer process to obtain information from the CAIS voluntarily. The Debtors have so far been unsuccessful. On a phone call on August 22, 2023, counsel for CAIS expressed unwillingness to make its records related to the transfers available to the Debtors. In emails between October 2-6, 2023, Debtors requested information concerning the amount of Debtor funds CAIS has spent, the amount of Debtor funds it has retained, and its financial condition. CAIS declined to provide that information.

The motion concludes by stating that notice of this action has been provided to relevant parties, including the US Trustee, the Committee’s counsel, the Securities and Exchange Commission, the Internal Revenue Service, the US Department of Justice, the US Attorney for the District of Delaware, and CAIS itself.

FTX’s native token, FTT, is trading at $1.22, marking a return to the $1 level for the first time since November 2022. Although it has experienced a decline of over 5% in the past 24 hours, the token has exhibited noteworthy gains over the past seven days, amounting to a 17% upward trend.

The token’s value has diminished by more than 95% when considering the one-year timeframe.

Featured image from Shutterstock, chart from TradingView.com

7th October 2023

Here’s How Sam Bankman-Fried Allegedly Used Customer Funds On Alameda Research

On day four of the criminal trial of former FTX CEO Sam Bankman-Fried, Gary Wang, who co-founded the now-bankrupt crypto exchange and served as its former chief technology officer (CTO), testified. During his testimony, the former FTX executive revealed details about the connection between the cryptocurrency exchange and Alameda Research.

FTX’s Sam Bankman-Fried Allegedly Gave Alameda Research ‘Special Privileges’

According to various reports, on Friday, October 6, Wang appeared again in court and testified that Alameda Research’s account on FTX was allowed to trade more funds than it had available. The former FTX CTO reportedly said that Sam Bankman-Fried authorized the integration of a “allow negative” feature, which afforded Alameda “special privileges” on FTX.

Wang reportedly revealed that the “allow negative” feature enabled Alameda to hold a negative balance more than FTX’s revenue at some point in 2020 ($200 million against $150 million). According to reports, Wang claimed that he increased Alameda’s line of credit several times and up to $65 billion under Bankman-Fried’s instructions.

When the government’s prosecutors questioned where the money came from, Wang reportedly affirmed that it came from FTX’s customers’ funds. Based on the co-founder’s testimony, Bankman-Fried claimed that the “allow negative” feature was all about FTT, a native cryptocurrency “created to act as equity in FTX.”

Wang reportedly acknowledged that the customers never authorized their funds to be used by Alameda Research. “The customers did not give us permission to use their accounts like this,” the former FTX chief technology officer allegedly said.

Did SBF Repeatedly Lie About Connections With Alameda?

During his testimony, Wang was asked whether he remembered Bankman-Fried making public statements about Alameda’s unusual connections with the FTX exchange. “Yes, he (SBF) said they (Alameda Research) were treated equally and didn’t use FTX funds,” the FTX cofounder allegedly affirmed.

Furthermore, the prosecutors showed Wang – and the court – a 2019 tweet from SBF claiming that Alameda was not using funds from FTX. Interestingly, Wang affirmed that Bankman-Fried ordered the addition of “allow negative” in the exchange’s codebase on the same day the tweet was made.

It appears that is not the only time Bankman-Fried lied about Alameda’s activities on the FTX exchange. The former FTX CTO testified that Bankman-Fried subsequently claimed on Twitter (now X) and on phone calls that customer funds were kept safe.

On Thursday, October 5, Gary Wang reportedly admitted to committing fraud-related crimes while at the FTX exchange alongside Sam Bankman-Fried, former Alameda CEO Caroline Ellison, and former engineering director Nishad Singh. With the trial expected to continue till November, it remains to be seen whether or when the other former top FTX and Alameda executives will take the stand.

Sam Bankman-Fried

4th October 2023

FTX’s FTT Price Skyrockets 20%: Here’s Why the Rally Has Just Begun

The FTT price has been challenging gravity and the overall trend in the crypto market for the past two weeks. A recent report hints at a potential bullish continuation based on this scenario and to the benefit of the FTX creditors.

As of this writing, the FTT price trades at $1.20, with sideways movement in the last 24 hours. The token recorded a 19% profit in the previous two weeks, while the last 30 days show a 15% increase. In the meantime, major cryptocurrencies have seen half of this price action over the same period.

FTT FTTUSDT FTX FTT Price

FTT Price On The Verge Of Massive Rally?

The surge in the FTT price is supported by the current negotiations between Artificial Intelligence (AI) company Anthropic and the big tech sector. As our sister website Bitcoinist reported, the company received a $1.5 billion capital injection from Amazon.

The big tech giant committed to increasing their investment by up to $4 billion via Amazon Web Services (AWS). The partners will work to develop AI solutions to compete with Google, Microsoft, Nvidia, and others.

The AI company received support from failed crypto exchange FTX before its collapse in 2022. In that sense, if Anthropic can secure support from other big tech companies, the initial investment made by FTX will increase, allowing the new management to count on more assets and potentially repay creditors.

A recent report from the Information claims that Anthropic is exploring further partnerships following its Amazon deal. The OpenAI competitor could receive support from Google. The big tech giant already bought a 10% stake in the startup at the same time as FTX.

If this deal materializes, the company could increase its valuation from $4 billion to over $20 to $30 billion. Thus, FTX’s initial investment will increase by a significant amount.

The negotiations between Anthropic and its potential partners have directly impacted the FTT price. The current manager has publicly emphasized his intention to re-launch the trading venue to repay its creditors.

A successful sale of their stake in Anthropic could benefit FTX’s current management and give them enough capital to succeed. If this scenario materializes, the company’s native token is bound to extend its recent run and could potentially reclaim previously lost territory.

The FTT price reached an all-time high above $60, meaning it has much room to grow if the company relaunches. Any news related to Anthropic or an FTX’s relaunch will positively affect the token.

Cover image from Unsplash, chart from Tradingview

23rd September 2023

FTX CEO’s Asset Recovery Escalates As Sam Bankman-Fried Trial Looms

In a battle to recover billions of dollars following the collapse of FTX, Chief Executive and Restructuring Officer John J. Ray III, is intensifying efforts just weeks before FTX founder Sam Bankman-Fried faces trial in what has been labeled one of the largest financial frauds in American history.

Bankruptcy court proceedings kicked off the week as FTX filed a lawsuit against Bankman-Fried’s parents, Allan Joseph Bankman and Barbara Fried.

The suit aims to reclaim millions of dollars allegedly fraudulently transferred and misappropriated by the couple, who purportedly took advantage of their access and influence within FTX to enrich themselves at the expense of debtors and creditors.

Continuing the pursuit of recovery, FTX Trading Ltd. subsequently filed a lawsuit on Thursday against four former employees of Alameda Ltd., an FTX affiliate based in Hong Kong.

The complaint alleges that these employees received $153 million in transfers shortly before the collapse of the crypto trading platform.

According to Bloomberg, these individuals allegedly leveraged personal connections to prioritize the withdrawal of their funds and digital assets from FTX once it became evident that the company was facing financial turmoil.

FTX CEO Ramps Up Efforts To Reclaim Assets

Per Bloomberg’s report, the bankruptcy proceedings have attracted the attention of outside investors and speculators, including prominent distressed-debt investors like Silver Point Capital, Diameter Capital Partners, and Attestor Capital.

These entities have seized the opportunity to acquire discounted FTX claims, anticipating that the protracted bankruptcy process will uncover additional valuable assets.

Court records show that they have already purchased over $250 million worth of FTX debts since the beginning of the year, according to a Bloomberg analysis.

While legal actions are in progress, some funds are being voluntarily returned. Stanford University, where Bankman and Fried held teaching positions and enjoyed reputations as legal scholars, announced its decision to return millions of dollars received from FTX and its associated entities.

According to court documents, Stanford received gifts totaling approximately $5.5 million from FTX-related entities between November 2021 and May 2022.

Bankman-Fried Family Turns To Risky Strategy

According to a Fortune Magazine report, The Bankman-Fried family has adopted a risky strategy in their legal battle, shifting blame onto prominent law firm Sullivan & Cromwell.

They argue that the firm failed to act in its best interests, downplaying its involvement in FTX’s downfall. This move aims to establish an “advice of counsel” defense, painting Sam Bankman-Fried as a well-meaning individual who received “poor legal advice”.

Criticism of Sullivan & Cromwell’s substantial legal fees, exceeding $100 million in the FTX bankruptcy case, raises ethical concerns but not necessarily legal wrongdoing.

Per the report, the family’s strategy may backfire, as it could provide prosecutors with access to new evidence by waiving attorney-client privilege.

Furthermore, the defense’s focus on blaming the law firm invites scrutiny of Bankman-Fried’s father, an active participant in key business decisions. Additionally, Bankman-Fried’s father received $10 million in FTX funds that he has yet to return, potentially for his son’s legal defense.

The Bankman-Fried family’s attempt to discredit Sullivan & Cromwell introduces complexity to the case. However, its effectiveness remains uncertain. As the legal proceedings continue, the implications of these strategies on the case and public perception of the family remain to be seen.

FTX

Featured image from Shutterstock, chart from TradingView.com

11th May 2023

IRS Asserts First Dibs On FTX Bankruptcy Payout To Recover $44 Billion In Taxes

The US Internal Revenue Service (IRS) has filed tax claims in the FTX bankruptcy as the defunct exchange’s creditors seek fund reimbursement. This recent report shows the IRS filed dues of $44 billion in taxes associated with FTX and its subsidiaries.

The disclosure revealed the agency filed the tax bill under administrative claims, prioritizing them over the creditors’ claims in the bankruptcy case.

Will Court Prioritize IRS Claims Over Creditors?

A filing by the IRS claiming billions of dollars in tax owed by Alameda Research has been circulating online. The filing shows the IRS is claiming over $20.4 billion in unpaid partnership and payroll taxes from Alameda Research alone under administrative priority.

The IRS filed 45 claims worth $44 billion in unpaid taxes from the now-bankrupt FTX exchange and its sister companies. However, the tax filing category under administrative priority has drawn more attention than the amount after circulating the Internet.

A section of the US Bankruptcy Code states that claims under administrative expenses receive priority distribution. That means administrative claims have the highest priority among creditor claims in a bankruptcy case.

The IRS tax bill under administrative claims means the court will likely consider them during funds distribution before other unsecured FTX creditors. However, the dispute is still in motion, and the court is yet to determine how the filing affects the situation.

Nonetheless, the current situation sparked people’s curiosity. A partner at General Catalyst, Nick Van Eck, is curious about how to calculate the amount and where the funds will come from.

But while reactions across the internet continue to emerge, the IRS remained silent without providing any details regarding the matter.

FTX Closer To Repaying Creditors, Mulls Reopening Plans

This development came after the news that FTX recovered $7.3 billion in assets, which was revealed by lawyers in an April 12 hearing at the Delaware bankruptcy court. IRS Asserts First Dibs On FTX Bankruptcy Payout To Recover $44B In Taxes

FTT remains bearish l Source: Tradingview.comFurther investigations into the bankrupt exchange’s assets are still ongoing. However, the legal team disclosed that FTX may resume operations in Q2 of 2024.

Meanwhile, the exchange’s former CEO, Sam Bankman-Fried, remains entrapped in webs of criminal charges by US prosecutors. His legal team has been working hard to save him.

In a recent court hearing, SBF’s lawyers asked the federal judge to waive the criminal charges, saying the case was more of a civil issue. The legal team also accused FTX lawyers of helping the prosecutors.

Featured image from Pexels, chart from Tradingview.com

20th April 2023

FTT Token On a 8% Rockslide Despite FTX Ray Of Hope. Here’s Why

FTT Token, the native coin of the failed crypto exchange FTX, is experiencing a slide in today’s trading session. While it started the trading day negatively, it showed no recovery and further declined in price, recording up to an 8% loss and finding a spot in the top 3 losers in the sector.

Despite its previous week’s rally stemming from news of a potential FTX reopening, FTT has shown investors the other side of the palm by reversing its gains. However, the negative drop in FTT is not peculiar to it alone, as other cryptocurrencies have taken falls and show bearish price action.

Why Is FTT Token Crashing?

The drop in the prices of cryptocurrencies, including FTT, could be attributed to Bitcoin’s negative price action. The largest cryptocurrency by market cap was declining in dominance, but a surge in selling pressure reverted this trend and dragged the rest of the market with it.

Yesterday’s trade session saw a drop in Bitcoin price as it failed to hold the key support level at $29,200. This resulted in a free fall of Bitcoin, looking to identify the next support area to hold up.

Bitcoin finally found some support at $28,600, although some Altcoins had already suffered the tolling effects from the drop. The Bitcoin fear and greed index had also shifted to a neutral number of 52, indicating a possible sideways movement in the markets.

According to Coinmarketcap data, the FTT token trades at $1.9 from its 24-hour highs of $2.0751. While the news of FTX reopening could boost the FTT token price, it is far from conclusive and definite.

Updates On FTX Potential Exchange Reopening

As seen from a Bloomberg report, Tribe Capital, a venture capital company, has shown some interest in reviving the collapsed FTX exchange, which went bankrupt in November 2022.

According to the report, Tribe Capital, an FTX investor before the disastrous collapse, is considering a fresh volume of capital injection to kickstart the processes and bring the company back from its bankruptcy process.

While in the works of injecting $100 million of its venture-owned capital and limited partners, Tribe Capital is also considering piloting a $150 million fund-raising campaign to scale the process of reviving the exchange.

Arjun Sethi, the co-founder of Tribe Capital, also met with FTX, the unsecured creditor’s committee, to discuss an informal proposal to revive the FTX exchange, according to the report.

In a recent development, the FTX committee of unsecured creditors posted on their official Twitter handle that the entity is working with debtors to evaluate all options to reboot or sell the FTX exchange and create value for creditors. FTT Token continues to be on the traders’ watchlist as FTX developments unfold.

Featured Image from Istock, Chart from TradingView.com.

13th December 2022

SEC Charges SBF Of Allegedly Conducting Fraud Schemes

The crypto community was left shell-shocked in November 2022 when FTX – one of the leading crypto exchange platforms, filed for bankruptcy. Pessimism towards crypto is at an all-time high, with famous investors like Warren Buffet seemingly right about the risks involved.

Investigations into the exchange uncovered gross financial misappropriation and abuse of users’ funds. The disastrous event left many investors seething and funds lost.

According to reports, FTX had allegedly acted unprofessionally and blurred corporate lines between FTX and sister corporation Alameda. The firm supposedly had borrowed funds illicitly from the exchange and sparked an outcry for regulating crypto exchanges. The revelation led to a negative trend in the cryptocurrency market, with exchanges treading cautiously.

In recent events, Sam Bankman-Fried has been arrested in the Bahamas and is facing the possibility of prosecution for fraud.

SBF Arrest And Charges

According to CNN reports, Sam Bankman-Fried, the founder and ex-CEO of FTX, was arrested in the Bahamas on Monday at his apartment. This arrest comes on the heels of criminal charges against him.

According to U.S. attorney Damian Williams, Samuel Bankman-Fried was arrested at the request of the U.S. Government. This arrest resulted from a sealed indictment filed by the SDNY.

His arrests occurred around 6 pm ET on Monday, and he will likely face a Nassau court today, as detailed by the Royal Bahamas Police force.

The Security and Exchange Commission also stated it had created separate charges for SBF for violating securities laws.

Charges against SBF include wire fraud, security fraud, securities fraud, and money laundering.

SBF faces the possibility of extradition to face his charges. According to the United States extradition treaty with the Bahamas, U.S. prosecutors can return defendants to American soil.

The condition for the extradition is that the offense must be considered punishable by at least one-year imprisonment in both countries.

SBF was to appear before the House Committee today to shed light on recent events. However, due to his arrest on Monday, the new CEO of FTX – John J. Ray III, will reveal his findings to the House.

What’s Next For FTX Token Holders?

The FTT token lost most of its value in the heat of the FTX saga that saw investors liquidate positions in droves.

It is now unclear if investors will truly get compensation for their losses. The token price has plummeted, with the SBF arrest set to unfold another chapter in this saga. The former CEO might face prosecution and possible jail time.

19th November 2022

This Crypto Venture Capital Loses Almost $1B On FTX, When Will This FTX Fiasco End?

The collapse of the FTX crypto exchange is one of the biggest shocks to hit the industry. The impact of the fall is spreading to different crypto assets and several investors on the exchange.

The crypto market has been experiencing massive downward performance as prices of assets kept declining. Hence, the overall value is far below expectations, creating more fears and doubts in crypto.

Following the unfolding events and crisis, the CEO of FTX, Sam Bankman-Fried (SBF), filed for bankruptcy for the distressed FTX exchange. He also resigned from his position as CEO.

On the part of FTX investors, the story is getting more intense. Several venture investors and individuals have started counting the losses following the bankruptcy filing. Also, the contagion from the collapse of the exchange is still spreading. One such recipient of the negative effect is Multicoin Capital.

Multicoin Capital Exposure To FTX Crypto Exchange

In the new development, a crypto venture company, Multicoin Capital, has disclosed its exposure to FTX. On Thursday, the firm reported how the fund plummeted by a whopping 55% over last month. It revealed to its investors that the drop in performance was due to the collapse of FTX.

The events surrounding FTX gave a huge blow to Multicoin. In July, the firm launched its $430 million fund. As the FTX saga was unwinding last week, the crypto venture firm recovered just one-quarter of its assets from the exchange. But, about 15% of its total assets are still trapped on FTX.

Currently, Multicoin Capital plans to write down its assets on the distressed FTX to zero. It noted that it’s the only sensible action to take as the exchange is already immersed in its bankruptcy proceedings. However, it still believed that it would recover some of its assets from the collapsed exchange in the future.

At the moment, the crypto venture giant didn’t state the amount it’s writing off regarding the FTX crisis. But some crypto market experts think the value would be more than $850 million.

The managing partners of Multicoin, Kyle Samani and Tushar Jain, reacted to the situation in the post. They wrote that they over-trusted their relationship with FTX, which made them lay many assets on the exchange.

Multicoin Capital Now Resorts To A Majorly Self-Custodian

Before now, Multicoin Capital distributed all its assets across the three leading crypto exchanges; Binance, Coinbase, and FTX. Following the collapse of FTX, the venture firm moved all its remaining assets to either self-custody or Coinbase.

FTT price continues to decline l FTTUSDT on Tradingview.com

Multicoin stated that it currently has no assets exposed to any counterparties. However, it plans to diversify its custodial exposure picking Coinbase as its primary custodian. It noted that it would resume trading with other exchanges once the situation in the market becomes calm.

Further, the crypto venture firm believes that the contagion from the FTX will continue to spread. It mentioned that several trading firms would shut down from the collapse of FTX and its sister trading platform, Alameda Research.

Featured image from Pixabay, chart from TradingView.com

16th November 2022

This Firm Offers 8 To 12 Cents On A Dollar Of FTX User Deposit Claims

The FTX crisis has escalated into a legal battle between bankrupt crypto exchanges and firms whose assets are stuck on its platform. Before FTX froze assets withdrawal, many crypto firms couldn’t recover their funds from the exchange. As a result, many firms have announced a potential financial crisis if their funds remain unrecovered.

Several Users are in a panic due to their funds. However, the latest report revealed that Cherokee Acquisition, a distressed asset investment firm, has given users options to sell their credit claims. But the users can only recover a fraction of their total assets holdings.

Cherokee Acquisition has a marketplace for credit claims against bankrupt companies like FTX Exchange. The firm placed a guide price on a dollar of FTX user’s deposit claims above $100,000 in the new price table released on November 15.

The guide price is between 8 to 12 cents on every dollar of the deposit claims. This is an option for FTX’s creditors who cannot wait till the full resolution of the bankruptcy proceedings to recover their assets.

Low Price indicates A Low Probability Of Retrieving User Credit Claims

When a firm files for Chapter 11 bankruptcy protection, impatient creditors may sell their credit claims to distressed asset investment companies like Cherokee Acquisition. The distressed assets investment funds place value on the credit claims so that while the creditors can recover parts of their assets, they too can make a profit after redeeming the allegations.

However, Cherokee Acquisition’s guide price for the FTX credit claims is relatively low compared to what other bankrupt companies’ users may get. It suggests an almost zero probability for users to retrieve their funds. Celsius Network’s Earn account holders may receive about 20 cents on a dollar after selling their claims. Voyager Digital’s creditors may also get 40 cents on a dollar for their credit claims.

Thomas Braziel, the managing partner at 507 Capital, a distressed corporate specialist firm, commented on the meager price tag of FTX’s credit claims. However, he said the price might be too high for potential buyers.

According to Braziel, no one is buying the FTX credit claims at that price. Braziel highlighted that the best market price for the deposit claims to be between 3 and 5 cents.

The FTX Crisis, How It Started, And How It’s Going

FTX is a conglomerate of over 130 firms that filed for bankruptcy on Friday. The FTX issue began after the firm’s use of customers’ deposits for investing and lending without their approval came to light.

The firm’s balance sheet also found a deficit of $10 billion. As a result, FTX went bankrupt with funds from large firms, such as Genesis Trading, Galois Capital, and Ikigai Asset Management, stuck on its platform.

Users created improvisatory Telegram chat groups to sell their stuck deposits one week after FTX suspended withdrawal. Meanwhile, FTT has declined 10.08% more in the last 24 hours and is now trading at $1.57.

FTT price continues to plunge l FTTUSDT on Tradingview.com

Featured image from Pixabay, chart from TradingView.com