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Highlights
- FTX continues to liquidate its crypto holdings supporting its debt repayment plans.
- FTX has announced the repayments to creditors and customers along with additional interest.
- FTX creditors have said that they's aren't happy with the repayment plan, and demand crypto settlements instead of USD.
During April, cryptocurrency exchange FTX and its affiliate Alameda Research liquidated a significant portion of their crypto assets, totaling $98 million. Notably, the bankrupt FTX exchange has been selling its Solana (SOL) holdings to reimburse its customers. It’s likely that this selling pressure from the exchange could persist in the future.
More Selloff Coming From FTX?
According to data from blockchain analytics firm Arkham Intelligence, tagged wallets associated with FTX and Alameda Research have initiated liquidations totaling $97.35 million in the past month. FTX’s holdings include $33.85 million worth of BOBA and $11.22 million in ETH, in addition to controlling over 78% of the FTT supply. On the other hand, Pantera Capital has absorbed most of the sales of FTX’s Solana Holdings.
Meanwhile, Alameda Research holds significant positions in various assets, including $140 million worth of WLD, $102 million of BIT, $93 million of BTC, and $48 million of STG. Thus, there’s enough possibility that these two companies would be divesting their stake going ahead.
Tagged FTX and Alameda wallets have sent a combined $97.35M to be liquidated in the past month.
FTX still holds $33.85M in BOBA and $11.22M in ETH – in addition to over 78% of the FTT supply.
Alameda’s main holdings are $140M of WLD, $102M of BIT, $93M of BTC and $48M of STG.… pic.twitter.com/bUpuJm9FSQ
— Arkham (@ArkhamIntel) May 9, 2024
The Surge In Claims
Investor interest in FTX claims has surged following the estate’s draft recovery plan, which forecasts a recovery rate of 118% for the majority of creditors.
Louis Origny, the Chief Technology Officer of claim buyer FTXCreditor, which has already obtained more than 2,100 claims, foresees an uptick in claim-purchasing activities. Origny identified two factors contributing to this expectation: firstly, the disclosure statement’s reference to a potential 30% tax withholding rate for non-U.S. customers, which may prompt holders to sell their claims on the secondary market, and secondly, the incapacity of all claim holders to cash USD checks.
FTX creditors will get OVER 100% of their money back, but @LouisOrigny (co-founder of @ftxcreditor_com) & I discuss why this is a deceptive statement & break down the pros/cons of FTX's new plan. A LOT of customers are getting screwed (feat. @arush). pic.twitter.com/cvOekwUpQL
— Tiffany Fong (@TiffanyFong_) May 10, 2024
On the other hand, creditors have also been voicing their opposition to the repayment plan. The primary issue at hand is that the bankruptcy estate halted the valuation of customer crypto assets in November 2022, coinciding with the trough of the bear market.
FTX says most of its customers will get all their money back but many are unhappy.
“The main problem here is that the bankruptcy estate froze the value of customer crypto assets back in November of 2022,” says @KenzieSigalos. “We’re talking about the bottom of the bear market.” pic.twitter.com/nK3dxRuCQb
— Last Call (@LastCallCNBC) May 8, 2024
As a result, most of the FTX creditors have been demanding their repayments back in crypto holdings, instead of the USD. Crypto exchange FTX has yet to come up with a response in this regard.
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