#FTXrepayment

The reason for the collapse of FTX and the compensation of users

FTX collapsed in November 2022 due to financial mismanagement and the use of customer funds in illegal investments by Sam Bankman-Fried (former CEO). The most important reasons:

1. Money manipulation: FTX used customer funds to fund its subsidiary Alameda Research.

2. Suspicious financial leaks and reports: A report from CoinDesk revealed major liquidity problems at Alameda.

3. Market panic: Binance’s announcement of its intention to sell FTT coins (specific to FTX) led to a significant drop in its price.

4. Official bankruptcy: After failed attempts to save the platform, FTX declared bankruptcy in November 2022.

Compensation of users (#FTXrepayment):

After the bankruptcy proceedings, a plan was put in place to repay affected customers, which includes:

1. Refund of users’ funds: FTX’s assets (such as its investments in companies and digital currencies) are being liquidated.

2. Selling digital assets: such as SOL, BTC, and ETH to increase liquidity to repay customers.

3. Priority of repayment: Compensation will be paid first to affected users before investors.

4. Repayment schedule: The repayment process has been announced to start in 2024 and continue until 2025, according to the bankruptcy court.

Latest developments:

Recent reports indicate that FTX has collected approximately $16 billion to repay customers.

Some users may not get their full money, but the repayment rate is expected to be high compared to other bankruptcies..