Synopsis: FTX Bankruptcy of November 2022 took a surprise turn with creditors to the exchange expected to recover 118% of their investments from the FTX exchange

FTX Creditors, unfortunately, were the target of the November 2022 scam involving the Sam Bankman-Fried trial. They got a surprise gift today, FTX exchange has promised to return 118% of creditors’ invested money soon.

FTX, a major crypto exchange fell to ruins due to potential fraud and severe mismanagement leaving hundreds of FTX Creditors losing access to their crypto assets. FTX’s new leadership had initiated bankruptcy proceedings to identify and liquidate present assets to repay creditors.

Put this down to crazy news: after Sam Bankman-Fried’s trial, it now turns out FTX has enough money to repay all its creditors with interest. Now Bitcoin value has gone up even more, but still: https://t.co/oLwPyRdyjO

— I Hate Politics Podcast (@ihppod) May 9, 2024

FTX Creditors to get a whopping $15 Billion in Recoveries!

FTX, thanks to the sale of illiquid investments previously held by the exchange and its sister trading firm, Alameda Research, has successfully recovered $15 Billion in capital. FTX has promised impressive recovery rates to Creditors, announcing a promising payout structure.

Smaller Creditors (claims under $50,000) are poised to get 118% of their investments whereas large investors will receive 100% of their invested money.

Potential Restored Trust for Crypto Exchanges

Crypto markets and their numerous exchanges have been received with mixed degrees of acceptance amongst new investors, common folks, and crypto enthusiasts.

The FTX recovery announcement will set a new precedent for future crypto exchange failures, and boosting building trust among current and new potential investors in the crypto market sector.

FTX Recovery Plan is a Work in Progress Currently

Creditors still need to hold their horses as this is not a final deal but a proposed plan with uncertain timelines for the payouts.

The plan will need court approval and might be modified in the long run. When everything is set in order, creditors will receive their money in the near foreseeable future.

This news encourages new investors to trust crypto for long-term gains but it should be taken with a grain of salt. Cryptocurrencies are synonymous with ups and downs every other day. One should do their own research before investing.

Also read: XRP Lawsuit Heats Up Between Ripple’s CLO and SEC’s Remedies