FTX’s Big Promise: Guarantees to Pay Back Customers Completely, Ditches Exchange Revival Plan

The post FTX’s Big Promise: Guarantees to Pay Back Customers Completely, Ditches Exchange Revival Plan appeared first on Coinpedia Fintech News

FTX, the bankrupt crypto exchange, informed the overseeing judge that customers and creditors who can prove their losses are expected to receive their entire funds. Simultaneously the company has rejected any plans to restart the exchange. Unfortunately, this news let the initial rise in the FTT token’s value turn negative, leading to a 15% drop today.

FTX Expects to Compensate 

In a recent court hearing on Wednesday, FTX’s lawyer, Andrew Dietderich, shared that the company is optimistic about having enough funds to fully compensate all valid customer and creditor claims.

The reimbursement plan involves evaluating the cryptocurrency prices customers bought in November 2022, which is when FTX faced financial trouble. Despite this positive outlook, Dietderich acknowledges challenges in the process. The company needs to carefully examine each claim to confirm its legitimacy, a task that poses complexities in retrieving lost funds.

Dietderich emphasizes that their optimism shouldn’t be seen as a guarantee but rather as an objective. He highlights the substantial amount of work and risks involved but expresses confidence in the feasibility of the objective, citing a devised strategy to achieve it.

Won’t Restart Crypto Exchange

Further, FTX lawyer Andrew Dietderich said that the company no longer has plans to restart its operations, putting an end to previous rumors. 

Dietderich dismissed any notion that the business was doing well, labeling it as an irresponsible sham created by a convicted felon, referring to the founder and former CEO Sam Bankman-Fried.

Claims Assessment and Complications

FTX faced a massive challenge with more than 36,000 claims totaling around $16 billion. Last year, they were unsure if they could pay back everyone, thinking it might only be about 90% of the customers. But now, FTX is more positive. They believe they have enough money to pay all the valid claims from customers and creditors.

FTX Token Takes a Hit

After FTX shared their plans to pay back and not restart the exchange, their own coin, FTT, first went up more than 11%. But then, it went down a lot, about 15% on Wednesday. As of now, the FTT token is hovering at $1.87 which is down by 30% in 24 hours. This shows that people are unsure about what will happen with FTX, especially with the person who started it in legal trouble.