The FTX collapse in November 2022 left a significant dent in the cryptocurrency markets, saddling investors with billions in losses. Institutional clients linked to FTX faced even heavier financial blows. The fallout even saw the imprisoning of SBF, and the Democratic party’s dissatisfaction with cryptocurrencies became apparent. Recently, there have been claims of a 143% refund, hinting that losses have been recuperated. Is there credibility to this claim?
How Was the Refund Managed?
Efforts to reimburse billions to FTX’s creditors have been in progress for an extended period, nearing completion. While creditors adhered to the guidelines provided, recovering parts of their investments, the reimbursements were calculated based on the market prices prevalent during the 2022 debacle, leaving many dissatisfied.
Did Creditors Truly Receive More Than Expected?
No. Despite creditors regaining some funds, the process wasn’t seamless. The crypto market saw drastic drops during the FTX’s bankruptcy, with Bitcoin plummeting below $20,000 and speculation of further dips below $15,000. This situation left creditors unable to access their rightful amounts as equivalent funds were missing from FTX accounts. Liquidating these assets and converting them into cash was a slow process. As prices rose again later, the FTX bankruptcy committee managed to sell assets at levels higher than those in November 2022, giving an illusion of overcompensation.
The Potential of Airdrops for Defrauded Creditors?
FTX creditor spokesperson Sunil explained misconceptions about the supposed refund rates. He asserted creditors received between 9% to 46% of their dues, refuting the 143% reimbursement figures. Altcoins saw previous price surges, but the refunds were pegged to 2022 values. Moreover, the court declined in-kind reimbursements, challenging creditors to restore their crypto portfolios.
“Outside the bankruptcy process, projects are expected to provide additional recovery through airdrops to FTX creditors. Paradex has already conducted a token airdrop to FTX creditors, and more projects are anticipated to follow suit.” – Sunil, FTX creditor representative
Sunil’s comments on the airdrop possibility present a glimmer of hope for those affected by the FTX debacle, potentially allowing partial recovery of their losses through such initiatives.
– Partial refunds realized, with effective rates between 9% and 46%.
– Refunds based on market prices during 2022’s crash, not current values.
– Airdrops offer a possible avenue for additional compensation.
Sunil’s insights suggest a future where further refunds might come through airdrops, as some projects have already started this process, indicating potential relief for the wronged creditors.
