After almost two years of legal battles, bankrupt crypto exchange FTX has reached a $12.7 billion settlement with the U.S. Commodity Futures Trading Commission (CFTC). The settlement resolves the litigation between the two parties, with FTX agreeing to pay $8.7 billion in restitution and $4 billion to customers whose deposits were locked after the exchange's collapse in November 2022.
In a statement, CFTC Chairman Rostin Behnam criticized FTX for drawing customers in with an "illusion it was a safe and secure place to access crypto markets" while misappropriating their deposits for risky investments. The court order will implement the final settlement, allowing FTX to proceed with its bankruptcy liquidation and pave the way for customer repayments.
According to the bankruptcy filing, FTX had over 100,000 creditors and assets ranging from $10 billion to $50 billion. At the height of its power, the exchange was worth $32 billion with a million users. However, it all came crashing down in November 2022 after revelations that most of its assets were held by Alameda Research, a sister company.
As of August 8th, FTX and Alameda currently hold $630 million in assets, including 266.85 million FTT tokens ($344.24 million), 105.47 million BIT tokens ($113.26 million), and various other holdings. FTX has committed to ensuring that all customers will receive 100% of their claims based on the 2022 account values.
The CFTC has stated that it will not seek any payment from the company until all customers are fully repaid with interest. This settlement marks a significant milestone in the FTX saga, providing some relief to the exchange's customers and paving the way for the company's liquidation and repayment process.
