“The costs and risks of creating a viable exchange from what Mr Bankman-Fried left in a dumpster were simply too high.”
AWOL
The attempt to resuscitate FTX is dead on arrival, and soon the defunct exchange will repay the people its convicted felon co-founder bilked out of money.
As The Guardian reports, company attorney Andrew Dietderich admitted that there will be no FTX comeback because, basically, nobody was dumb enough to try and rebuild it.
From the time one-time head Sam Bankman-Fried was first arrested back in November 2022 until now, there have been repeated and vague reports about a potential bounce-back for the shuttered brand.
Nevertheless, all those half-baked announcements and the attempts behind the scenes failed to come to fruition because, as Dietderich explained, the infamous co-founder never built a solid enough foundation for it to run properly, ultimately demonstrating that the “costs and risks of creating a viable exchange from what Mr Bankman-Fried left in a dumpster were simply too high.”
“This hopefully puts to bed the alternative narrative that this business was just fine all along,” Dietderich said, per The Verge‘s transcription, during the bankruptcy court hearing in Delaware earlier this week. “It was an irresponsible sham, created by a convicted felon.”
Repaid In Full
Now, FTX’s gameplan is all about liquidating its assets and repaying its defrauded investors — though as Reuters reported last month, some are less than pleased with the plan to reimburse them based on crypto prices from November 2022, when the exchange went belly-up and in doing so tanked the market. It’s not hard to see why, because as the report explains, Bitcoin was trading at $16,000 per coin in November 2022, and is today hovering around $43,000.
From the sound of things, however, they may have to take what they can get.
“I would like the court and stakeholders to understand this not as a guarantee, but as an objective,” Dietderich said. “There is still a great amount of work and risk between us and that result, but we believe the objective is within reach, and we have a strategy to achieve it.”
Last spring, reports indicated that FTX was able to recover $7.3 billion in assets with which to repay its customers, and as The Guardian notes, government regulators agreed not to try to collect on that missing $9 billion in claims until after they’re made whole.
It seems that FTX’s long-suffering attorney may be getting ready to finally close the book on the exchange — and as SBF awaits sentencing and the crypto industry bounces back, at least some closure could be a good thing.
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