John Ray, chief executive officer of FTX Cryptocurrency Derivatives Exchange, arrives at bankruptcy court in Wilmington, Delaware, US, on Tuesday, Nov. 22, 2022.
Eric Lee | Bloomberg | Getty Images
FTX has recovered over $5 billion price of liquid assets, including money and digital assets, attorneys in Delaware bankruptcy court said during an FTX bankruptcy hearing Wednesday.
The news comes after federal prosecutors announced plans to seize a minimum of $500 million price of FTX-connected assets as a part of their ongoing prosecution of FTX co-founder Sam Bankman-Fried.
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The recovery shall be a welcome boon to FTX customers after the crypto exchange imploded in November. FTX’s latest CEO, John J. Ray, previously attested that a minimum of $8 billion of customer assets were unaccounted for within the “worst” case of corporate control he’d ever seen.
The $5 billion figure doesn’t include any illiquid cryptocurrency assets, FTX attorney Adam Landis told the court. He said the corporate’s holdings are so large that selling them would substantially affect the market, driving down their value.
FTX’s collapse was related to, amongst other things, a failure to accurately mark illiquid assets to market. FTX executives, including Bankman-Fried and Alameda Research CEO Caroline Ellison, borrowed against the worth of the FTX-issued token FTT. Alameda controlled the overwhelming majority of FTT coins circulating, just like a publicly traded firms float, and will not have liquidated their position at full book value.
Correction: This text has been updated to reflect that FTX attorney Adam Landis told the court the $5 billion figure doesn’t include any illiquid cryptocurrency assets.
