FTX Recovery Could Take Two Years

The Post learned that Wall Street executives representing creditors in Sam Bankman-Fried FTX’s scandal are becoming more optimistic about their ability to recover a substantial amount of money that was lost during the chaotic implosion.

According to those with direct knowledge, however, it could take up to two years for the process to complete, leaving almost a million FTX customers without money and in limbo for the foreseeable future.

These people claim that John Ray, the new CEO of FTX, could recover half or two-thirds (or more) of the $8 billion loss when Bankman-Fried allegedly stole crypto wallets from as many as one million customers.

Ray filed paperwork with court to show that he was optimistic about his creditor recovery. he had found around $5 billion in liquid assets.

However, it could prove difficult to value many of these assets, especially when you consider investments in volatile venture capital or illiquid crypto. This could result in less money being distributed to creditors.

While Bitcoin prices have risen due to a flight towards quality, other cryptos traded lower after the FTX crash. This is because investors are afraid of regulation and fear that these coins will lose their intrinsic value.

Catch up on The Post’s latest in the Sam Bankman-Fried FTX scandal

“We don’t know if Ray will value money going back to people based on what their crypto is worth then or what it’s worth now,” According to one of the attorneys involved in this process.

Ray didn’t return calls for comment.

Securities fraud charges have been brought against Bankman-Fried. Prosecutors allege he stole money from FTX customer wallets To pay for losses in the Alameda Research hedge funds he managed, he was able to finance his extravagant lifestyle and make political contributions to influence government oversight of crypto industry.

FTX’s dramatic collapse in November and bankruptcy is still roiling the $1 trillion crypto currency market. Bankman-Fried was known as SBF in the crypto industry. He built a digital empire which grew to $30 billion.

Ray is attempting to seize his assets and return the money to creditors. He is represented by the law company Sullivan & Cromwell as well as Wall Street advisers Perella Wineberg and Alvarez & Marsal.

SBF spent tens of million dollars on charities and non-profits in addition to his business ventures. He was one of President Biden’s largest contributors To his 2020 campaign.

The ill-fated FTX empire, which includes subsidiaries Bankman-Fried founded and a variety of venture capital investments, will be sold off by investment bankers.

People familiar with the matter claim Ray could even recover charitable donations and political contributions. He also is considering re-starting the FTX exchange Additional cash may be available.

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