- What is known about the compensation plan
- The community speculates on the timing of compensation payments
- FTT Reacts With Growth
- Where did the client funds go?
- Victims are waiting, and the culprits are serving their sentences
New details have emerged about the compensation plan for FTX clients, which involves returning between 10% and 25% of the deposited crypto asset value. This has sparked many questions and discussions within the community.
What is known about the compensation plan
Crypto assets deposited on the platform will be valued at the rate when filing for bankruptcy. Therefore, the actual compensation will be between 10% and 25% of the market value of their cryptocurrency.
The community speculates on the timing of compensation payments
Work is underway to return funds to account holders affected by the FTX collapse. Amid speculation about the timing of the payments, information appeared on the network that FTX crypto holders could begin receiving payments as early as Sep 30. However, this was soon refuted: according to the latest data from the bankruptcy case materials under Chapter 11, the court is still studying a compensation plan.
FTT Reacts With Growth
Amid the recent news, FTX has delighted investors. Hoping that the infamous crypto exchange would soon begin returning funds, investors have become more optimistic. Such an event could lead to an influx of $16 billion into the market. At its peak on Sep. 29, the FTX token (FTT) had gained 113% in a day. By the end of the day, the price had corrected and eventually dropped to $2.11 at the time of writing.
Where did the client funds go?
FTX, once worth $32 billion, used client funds for risky investments through its closely associated hedge fund, Alameda Research. Investigations revealed that the company used client funds to cover losses in other related businesses and finance risky investment deals. The colossal budget deficit was discovered after clients requested their money back.
Victims are waiting, and the culprits are serving their sentences
FTX’s bankruptcy shook the crypto market and affected the prices of many coins. It also raised concerns among users and regulators about the security and liability of crypto exchanges. In addition to creating a refund plan, the exchange’s top managers are being punished one after another. Sam Bankman-Fried was charged with fraud, money laundering, and other financial crimes related to the management of FTX and client payments. He was sentenced to 25 years in prison. Former Alameda Research CEO Caroline Ellison was sentenced to two years in prison and forfeited $11 billion on fraud and money laundering charges.
The compensation plans for FTX clients continue to generate extensive discussions and expectations within the community. The investigation is ongoing, while the culprits serve their sentences.
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