FTX Debtors Recover $5.5B in Assets, but Digital Assets Shortfall Remains

• FTX Debtors recently revealed that it recovered $5.5 billion in liquid assets, $1.7 billion of which was in cash, $3.5 billion in cryptocurrencies, and $0.3 billion in securities.
• FTX Debtors also confirmed that, based on current estimates of the amount of digital assets associated with the FTX.com and FTX US exchanges as of the Petition Date, there is a substantial shortfall of digital assets at both exchanges.
• The presentation also showed that the exchange had allowed Alameda to borrow up to $65 billion of customers‘ funds without collateral.

FTX Debtors recently revealed details regarding the bankruptcy proceedings, which included a meeting with the advisors and members of the Official Committee of Unsecured Creditors (OCC). During the meeting, FTX Debtors revealed that the composition of the assets recovered, which included $5.5 billion in liquid assets consisting of $1.7 billion in cash, $3.5 billion in cryptocurrencies, and $0.3 billion in securities. However, despite the large recovery, FTX Debtors stated that both FTX and FTX US still fall short of money.

A press release on the same read, „The FTX Debtors also confirmed that, based on current estimates of the amount of digital assets associated with the FTX.com and FTX US exchanges as of the Petition Date, there is a substantial shortfall of digital assets at both exchanges.“ The presentation also showed that the top tokens held by FTX, FTX.US, and Alameda were Solana (SOL), FTT, Bitcoin (BTC), Ethereum (ETH), Aptos (APT), Dogecoin (DOGE), Matic, XRP, and others. Meanwhile, the tokens in the illiquid crypto assets list included Serum (SRM), SOLETH, MAPS, SOLBTC, Oxygen (OXY), MEDIA, and BEAR.

Moreover, the Debtors identified 36 properties of the exchange in the Bahamas. The value of these properties was estimated at $253 million on a cost basis. Furthermore, the presentation showed that the exchange had allowed Alameda to borrow up to $65 billion of customers‘ funds without collateral. This arrangement was done through a back door to Alameda, which gave the research arm access to borrow billions of customers fund without collateral.

With the recent update on the bankruptcy proceedings, it is clear that FTX Debtors is making progress in recovering the assets. However, the money recovered is still far from the amount of assets that were supposed to be on both FTX.com and FTX US. It remains to be seen if the Debtors will be able to make up for the shortfall of digital assets at both exchanges.