FTX Has Billions More Than Needed to Pay Bankruptcy Victims

FTX, the cryptocurrency exchange that collapsed in November 2022, has accumulated billions more than needed to fully reimburse its customers, a rare feat in U.S. bankruptcy cases. The company benefited from a significant rally in cryptocurrencies and the sale of various assets, positioning it to distribute as much as $16.3 billion against the $11 billion owed to over 2 million creditors.

Despite the potential for full repayment plus interest to creditors, equity holders like Sequoia Capital and celebrities such as Tom Brady and Gisele Bündchen will likely receive nothing due to their lower priority in bankruptcy settlements. The recovery process has been boosted by the recent surge in cryptocurrency values, with some creditors potentially receiving up to 142% of their original claims. However, payouts are still months away as FTX navigates the final stages of its bankruptcy proceedings.