Administrators of FTX have identified US$5bn (£4.1bn) in assets, including cash, securities and crypto tokens, to repay creditors of the Sam Bankman-Fried’s collapsed cryptocurrency exchange.
According to Wednesday's filings, more than US$500mln in cash holed up in companies formerly run by Bankman-Fried has been recovered, bringing total cash held by FTX’s administration team to US$1.7bn.
Four subsidiaries, including infrastructure provider Embed, derivatives platform LedgerX, and FTX units in Europe and Japan, have been cleared for sale by Delaware judge John Dorsey.
Investment bank Perella Weinberg Partners has been selected to lead the sale, which has more than 100 interested parties, according to the Financial Times.
Due to the extreme levels of mismanagement and incompetence in the running of FTX (Bankman-Fried’s words), the scale of user fund losses is still unknown, but early estimates put the figure at US$8bn.
Issues have arisen as to the value of the crypto assets held in FTX’s coffers.
“The amount of the shortfall is not yet clear,” said Andrew Dietderich, a partner at FTX’s legal counsel Sullivan & Cromwell.
Over nine million customers have lost money due to the collapse, though the identity of most creditors will remain secret for at least three more months in order to protect sensitive commercial information that might be valuable to the company.
“A customer list in any bankruptcy is something that is protected . . . as a trade secret,” Dorsey said.
But some high-profile names were disclosed in recent court filings, including the Ontario Teachers Pension Fund, American Football superstar Tom Brady, his ex-wife and Brazilian supermodel Gisele Bündchen, Pantera Venture Fund, Sequoia, and Bankman-Fried himself.
Brady and Bündchen have come under particular scrutiny for promoting FTX to their fans in the past, as have Canadian billionaire Kevin O’Leary and comedian Larry David.
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It is uncertain which creditors will be at the front of the queue to get their funds back. FTC customers could face an uphill struggle, given that they are considered unsecured creditors per FTX’s terms and conditions.
Bankman-Fried is currently living at his parents’ California residence on a US$250mln bail, one of the largest in history. He faces life behind bars for orchestrating large-scale criminal fraud at FTX and sister company Alameda Research.