Three Bidders Vying for FTX Reboot

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  • FTX is currently evaluating proposals from potential bidders for its business, with a decision expected by mid-December
  • The company is making progress in resolving creditor issues and aims to submit a payout plan in December
  • FTX recently sent $8.6 million in cryptocurrencies to Binance as part of a potential creditor repayment plan

FTX, formerly one of the world’s largest cryptocurrency exchanges, is currently reviewing proposals from three potential bidders to resuscitate its operations. The decision regarding the future of FTX Trading Ltd is expected to be reached by mid-December, according to Kevin Cofsky, the investment banker representing FTX through Perella Weinberg Partners. Meanwhile, FTX has sent $8.6 million worth of cryptocurrencies to Binance in what analysts believe is the start of the creditor repayment process.

Various Options Open to Buyers

The concept of FTX being rebooted first emerged in January, and the possibility of a relaunch has gathered steam as the year has progressed. The available options for FTX include selling the entire exchange, which includes a valuable database of over 9 million customers, or seeking a strategic partner to aid in the resurrection of its trading platform. Additionally, there’s the possibility of FTX independently reviving its trading operations. While Cofsky confirmed that FTX is actively interacting with multiple parties, he refrained from revealing their identities.

Following its bankruptcy filing the previous year, FTX has been diligently working to secure funds for creditor repayments, successfully recovering approximately $7 billion in assets so far, which includes $3.4 billion in cryptocurrency assets, as documented in court records. This includes a recent transfer of $8.6 million worth of ETH, LINK, AAVE, and MKR from FTX and Alameda Research wallets to Binance, with analytics firm Nansen saying that this is the first stage of a creditor refund program:

Payout Plan Expected in December

FTX has made significant progress in resolving contentious issues with its main creditor groups, which paves the way for a detailed payout plan to be submitted in December, as communicated by the company’s attorney, Andrew Dietderich, in a court hearing.

Such plans, customary in bankruptcy proceedings, provide creditors with an estimated percentage of their potential recovery. However, the exact percentage retrieved for FTX’s customers remains uncertain, hinging on the outcome of a potential sale or the independent relaunch of the exchange.

FTX and Alameda are also involved in several lawsuits to recover hundreds of millions of dollars, while they have also been sued over lost funds by third parties.