About FTT

FTX Expected to Repay Customers in Full, But Won't Restart Defunct Cryptocurrency Exchange

FTT tokens initially spiked after the news turned negative, leading to a 15% plunge in FTT today.

According to a court hearing, FTX, the bankrupt cryptocurrency exchange run by Sam Bankman-Fried, said it expects to repay its customers in full.

Unfortunately for those waiting for their funds, however, the full restoration of customer assets is based on the moment FTX actually went bankrupt, when the market was already in disarray. That date has been preliminarily approved by U.S. Bankruptcy Judge John Dorsey, which has been a point of contention for some claimants.

Kris Hansen, an attorney for FTX's creditor committee, said at the hearing Wednesday, "Many of the claims are premised on a significant devaluation of the currency during the tumultuous period leading up to the filing date."

FTX attorney Andrew Dietderich said the repayment process being considered by the U.S. Bankruptcy Court would require claimants to submit evidence of their holdings on FTX and subsequent loss of assets, which would be reviewed by reorganization counsel. The court proceedings show that the defunct exchange abandoned plans to relaunch its platform due to a lack of buyers, so it has turned its focus to how to consolidate former customers.

Today's effort in court aims to move the case forward by allowing multiple creditor camps to obtain individual investor approval for this latest method of recovering funds. As of last fall, roughly 15 million people had lost a variety of cryptocurrencies worth a total of $30 billion to $35 billion in the wake of FTX's collapse, according to bankruptcy claims exchange Xclaim.

FTX's native token, FTT, spiked more than 11 percent after news of the company's plans, but quickly fell sharply, dropping about 15 percent throughout the day on Wednesday.

Bankman-Fried, which was convicted last year of stealing customer funds, collapsed at the end of 2022.