FTX uncovers $5.5 billion in liquid assets – Debtors explore ways to maximize recovery via potential sale of subsidiaries and real estate

On January 17, 2023, FTX Trading Ltd. and its affiliated debtors notified the public and stated that the current directors of the company have uncovered $5.5 billion in liquid assets to date. Senior executives, including FTX’s new CEO and Chief Restructuring Officer, John J. Ray III, met with the bankruptcy’s unsecured creditors committee to share the news.

FTX uncovers $5.5 billion in liquid assets through a “Herculean investigative effort

FTX has uncovered $5.5 billion in liquid assets, according to a press release issued at 2:40 p.m. Eastern time Tuesday. The debtors, including FTX CEO John J. Ray III, announced that the team identified the funds through a “Herculean investigative effort“. The company press release states that the team found $3.5 billion in crypto-currency assets, $1.7 billion in cash deposits and about $3 million in securities.

Read:  U.S. federal court rules against DACA program for undocumented migrants

FTX discovers $5.5 billion in liquid assets - Debtors explore ways to maximize recovery through potential sale of subsidiaries and real estate.
FTX’s new CEO and chief restructuring officer, John J. Ray III.

The press release further notes that the FTX team discovered that $323 million was lost through unauthorized third-party transfers before the Chapter 11 bankruptcy filing was recorded on November 11, 2022. In addition, $426 million “was transferred to a cold storage facility under the control of the Bahamas Securities Commission“, details the debtors’ declaration.

FTX discovers $5.5 billion in liquid assets - Debtors explore ways to maximize recovery through potential sale of subsidiaries and real estate.
Screenshot of FTX debtors presentation to unsecured creditors committee.

FTX debtors reveal that crypto assets currently held by FTX executives and restructuring teams are also kept in cold storage. “We are making significant progress in our efforts to maximize recoveries, and it took a herculean investigative effort by our team to uncover this preliminary information“, Ray explained in the update. “We ask our stakeholders to understand that this information is still preliminary and subject to change. We will provide additional information as soon as we are able to do so.

FTX debtors investigate historic transactions, including the Voyager and Blockfi deals, and $93 million in political donations.

The presentation shared with the unsecured creditors committee is also attached to the FTX press release, and it notes that “[a]n investigation “confirmed deficiencies in the international and U.S. exchanges“. In addition, the “revealed the mechanisms by which Alameda Research was able to borrow effectively unlimited amounts of money from clients without collateral“. The Debtors’ Report emphasizes that “[a]ny such mechanism was used by Alameda Research.small group of individuals“had the ability to withdraw assets from FTX without it ever being “recorded on the stock exchange register“.

Read:  Ukrainian man steals bitcoins from Russian black market and donates them to charity

FTX discovers $5.5 billion in liquid assets - Debtors explore ways to maximize recovery via potential sale of subsidiaries and real estate.
Screenshot of FTX debtors presentation to unsecured creditors committee.

In addition to the $5.5 billion recovered, the FTX Debtors are exploring multiple facets to maximize the recovery process through the “potential sale“of four subsidiaries. The team is exploring ways to monetize the hundreds of completed investments that currently hold a book value of about “$4.6 billion.”

FTX discovers $5.5 billion in liquid assets - Debtors explore ways to maximize recovery through potential sale of subsidiaries and real estate.
Screenshot of FTX debtors’ presentation to the unsecured creditors committee

FTX debtors want to maximize recovery by “marketing real estate in the Bahamas“, and investigators want to examine “all historical transactions” related to the company.

FTX discovers $5.5 billion in liquid assets - Debtors explore ways to maximize recovery via potential sale of subsidiaries and real estate.
Screenshot of FTX debtors presentation to unsecured creditors committee.

The real estate owned by the inner circle is worth approximately $205.5 million, spread across 27 different properties located in the Bahamas. The historical transactions under investigation involve the Voyager and Blockfi businesses, as well as $93 million worth of political donations made by FTX executives between March 2020 and November 2022.

The Best Online Bookmakers May 24 2024

BetMGM Casino

Bonus

$1,000