The digital assets analysts announced the discovery of investors actively pursuing FTX bankruptcy claims, anticipating profitable returns during the settlement of the existing debt. The analysts point out that investors are scooping the claims within the unregulated market, as illustrated in a Thursday, September 21 Bloomberg analysis on the FTX’s submissions.
Investors Attracted to FTX Debts
A review of the Claims Market data shows that FTX debts are attracting nearly 35% of the exchange price of the initial value. The claims attracted a bid price of 35% against an asking price of 40%. The Claims Market data captures claims representing a range of debt, including electricity bills and customer deposits FTX owes.
The Thursday analysis by Bloomberg cites the completion of claims sales exceeding $250M of the FTX debts. The claims purchase is linked with Silver Point Capital, Attestor Capital, and Diameter Capital Partners.
Also, the analysts admit the conclusion of a $23 million claim by a fortune cookie distributor acquired by Hudson Bay Capital Management (HBCM) for an undisclosed amount.
The Bloomberg publication acknowledges the likelihood of more claims exchanging hands than reported. The analysts consider that investors may have scooped claims exceeding $100 million since most take months to file paperwork that documents the trade.
FTX Claims Command Surging Prices
The analysts report that FTX claims are witnessing surging prices as the bankruptcy proceedings take shape. In particular, they observe that the trading value has increased steadily from 15% at the onset of 2023 to edge closer to the 35% debt value.
The analysts attribute the price increment to rising demand owing to the remarkable progress the John Ray II-Led restructuring team realized. Also, ongoing court proceedings and the arrest of FTX’s former boss, Sam Bankman-Fried, are fueling the surge.
A leading crypto trader, Benson Sun, indicated that claim buyers are projecting a 100% return on investments by 2028. The huge investment return relies on several factors that could influence the secondary market.
Sun acknowledges that clawbacks, adjustments to claim scale, and restructured timelines could contribute to higher returns. Also, the investors are banking on improved prices during asset liquidation and bid offers.
FTX Customers Issued Timeline to Contest Claims
A review of the latest court filings on September 11 disclosed that 72% of claimants are yet to agree or context the scheduled claims. The submission indicated that 10% of the claims have accepted the figures, with another 18% opposed and expressing dissatisfaction with the claim.
The filings captured FTX’s admission that most claimants cite struggling with the KYC process. Through the Ray III-led restructuring team, the firm directed the affected claimants to consider beginning the KYC process.
Through its official X (formerly Twitter) profile, the firm directs users via a Thursday, September 21 post that the claimants should file their proofs by September 29 at 4 PM ET. The post directed the claimants to process their claims via the customer portal.
The firm restated the necessity of beginning the KYC process. It dismissed the previous argument that one must verify KYC to submit the claim. Also, those disputing the scheduled claim must submit proof by Saturday, September 29.
The trade value could increase particularly as the Bankman-Fried’s case progresses.
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