TL;DR
On Wednesday this week, a judge formally ordered FTX and its sister company, Alameda Research, to pay $12.7 Billion USD to creditors, ending a 20-month-long lawsuit with the Commodity Futures Trading Commission (CFTC).
Full Story
For our final ever Web3 Daily news article (we’ll say a proper goodbye on Sunday), it feels fitting to write about FTX.
(The company that both made us and broke us in many ways – because people love reading about crazy news; but FTX also crippled the crypto industry along with the advertising budgets for many web3 companies).
On Wednesday this week, a judge formally ordered FTX and its sister company, Alameda Research, to pay $12.7 Billion USD to creditors, ending a 20-month-long lawsuit with the Commodity Futures Trading Commission (CFTC).
The order also bans FTX and Alameda from trading digital assets and acting as intermediaries in the market.
(Nipping in the bud even the slightest chance of a comeback for the company).
How in the world can a bankrupt company pay $12.7B to creditors?
Well, when Sam Bankrun-Fraud was sentenced, he was forced to forfeit $11B in assets (and given 25 years in prison for seven counts of fraud, conspiracy, and money laundering).
Plus, Alameda and FTX had significant crypto holdings in tokens other than the FTT token (FTX’s native token which went to zero) like Solana, which, since the crash that they started, has mostly gone up in value.
For now, FTX and Alameda have filed for bankruptcy, with the full restructure being administered by Kroll – who have the fun job of figuring out what assets are still owned, and which creditors should get how much, and in what order.
Alright! Now you know.
Conclusion
In a world where crypto companies can rise to fame and fortune one day, only to crash and burn the next, the saga of FTX and Alameda Research serves as a cautionary tale. The dramatic legal battle, the hefty financial penalties, and the ultimate bankruptcy filing remind us that no entity is too big to fail in the volatile world of cryptocurrencies.
As we bid farewell to Web3 Daily, we invite you to continue following the latest trends and news in the decentralized finance space on DeFi Daily News. Stay informed, stay curious, and remember, in the world of crypto, anything can happen!
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