By Evan Spicer
Director of Cryptocurrency Investigations
MyChargeBack
It was a debacle for the crypto world that was compared to the banking crisis of 2008 and the Bernie Madoff scandal rolled into one. The fall of FTX in November 2022 was greeted as, or feared to be, the end of the cryptocurrency craze and heralded in “crypto winter,” which led to a shellacking of crypto assets and a dramatic fall in bitcoin price.
Few would have believed that FTX could possibly come back from bankruptcy and ignominy, but it may happen. At an April 12 hearing at the United States Bankruptcy Court of the District of Delaware, FTX attorneys reported that the former crypto platform had recovered $7.3 billion in assets, a much higher amount than anticipated.
FTX Back from the Dead
Just months ago, FTX had only $3.3 billion in recovered funds, but the success of the recent fund recovery effort could put FTX on track to settle up their debts and open operations as early as April with a full re-opening of the crypto-exchange in 2024.
FTX CEO John Ray has spoken of reviving the disgraced crypto platform and released an “aspirational yet sensible” calendar for paying off the debt.
The FTX token, which measures the fortunes of the FTX platform, rose 110% on the news and increased in value from $1 to $2. In addition, FTX’s fortunes have been helped by the appreciation in the value of bitcoin and other cryptocurrencies.
It seems that time has healed some of FTX’s financial wounds as their crypto assets are recovering. For instance, bitcoin price has risen from $20,000 at the time of the FTX collapse to $30,000.
In addition to fund recovery efforts, FTX has been selling off assets to raise money to pay off customers and other creditors. The judge permitted FTX to sell off FTX Europe AG along with 133 subsidiaries and FTX Japan.
Will FTX’s Rising Tide Raise Customers’ Ships?
The recovery and a possible return of FTX may be good news for crypto enthusiasts and FTX’s high-profile creditors, but what about its former customers? Will they benefit from fund recovery?
Although $7.3 billion seems like an impressive amount to recover, it’s estimated that customer losses exceed that number at $8 billion. Added to that, many of the recovered funds will be used to pay back major clients. It’s not certain yet how many FTX customers will be compensated for their losses and to what degree.
Of course, many of Sam Bankman-Fried’s personal and FTX assets in the Bahamas could be sold to compensate the FTX crypto scam victims – theoretically. The issue of locating and forcing the sale of these assets is still being hashed out between U.S. regulators and Bahamanian authorities.
What Should FTX Crypto Scam Victims Do?
FTX crypto scam victims should make noise. Despite the billions of dollars that have been recovered, it’s not certain how much of this will go to repay individuals who were cheated by FTX.
However, one thing is for certain – the harder crypto scam victims push, the more likely they are to get results. It’s not important only to work hard, though, but to work smart. This means getting crypto recovery experts on your side who will make your case to the authorities and can improve your chances of recovering your funds.
MyChargeBack Will Help You with Crypto Recovery
If you have lost money to a cryptocurrency scheme, seek fund recovery assistance right away. Consult with MyChargeBack experts and get started with your fund recovery claim. We have extensive knowledge and working relationships with regulators and more than 450 law enforcement agencies around the world, as well as solutions that can improve your prospects of getting your cryptocurrency back.
