FTX Victims Are Set to Receive 119% Returns (Your Mom’s House is Safe After All)

Today we’ve got an update on the FTX scandal—remember that one? When all your internet buddies (and probably their moms) lost their hard-earned savings, houses, and their dog’s emergency vet fund in the FTX debacle, it felt like the crypto dream turned into a nightmare. 

We all thought Sam Bankman-Fried (SBF, for those who followed his rise and fall) was playing 4D chess while we were stuck on checkers. Turns out, the only game being played was “steal billions, get convicted, and land 25 years in prison.”

But in a turn that no one saw coming: if you were one of the unfortunate souls who poured your life savings into FTX, there’s a light at the end of the tunnel. And it’s not just your broke roommate flipping the light switch in the basement—this time, it’s cash.

A Delaware bankruptcy judge just gave the green light to FTX’s reorganization plan. And get this: almost 98% of creditors are going to profit from the money they put into FTX. Yeah, you read that right. They’ll get back 119% of their allowed claims. That's more than you had in November 2022 when SBF posted the “tweet heard round the world”.

How did we get here? Well, FTX’s new CEO, John J. Ray III, the guy who also cleaned up the Enron mess (so he's like the Michael Jordan of bankruptcy cleanups), spearheaded this operation. He and his team managed to collect somewhere between $14.7 billion and $16.5 billion worth of property. Yeah, that’s a lot of crypto, cash, and whatever else SBF was hoarding. And now, they’re ready to hand it out to the people who lost their shirts (and maybe their houses) in the chaos.

But here’s where it gets interesting: Bitcoin has surged 260% since FTX imploded. Some customers are understandably a little salty because the cash payout, while sweet, isn’t exactly equivalent to the value of their stolen crypto holdings had they been able to HODL all this time. But hey, as far as bankruptcy payouts go, this is like winning the crypto lottery compared to other epic corporate disasters.

One of the juicy details that helped fill FTX's coffers? Their stake in the artificial intelligence startup Anthropic, which they sold off for nearly $900 million. Thanks, AI, for bailing out crypto bros everywhere.

So, what’s next? Once this reorganization plan kicks into gear (should be about 60 days after the plan’s finalized), creditors can start lining up to get their payout. But don’t hold your breath just yet—there’s still some paperwork to shuffle through before everyone’s Venmo gets a little fatter.

Sure, it’s not a perfect ending, but considering how grim things looked back in November 2022, this feels like a miracle. FTX may have collapsed, but for most of its creditors, this is the comeback story they didn’t think they’d get. So, if you thought those crypto bucks were gone forever, think again. Your mom’s house? Might just be safe after all.

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