FTT, the native token of the now-defunct cryptocurrency exchange FTX, outperformed the global cryptocurrency market on Tuesday, soaring 11% on hopes of creditors’ repayment.
FTT Resurgence
Since FTX’s bankruptcy filing in late 2022, FTT has been struggling, dropping over 90% at one point. However, the exchange’s reboot or creditor repayment plans have positively impacted the token in recent months.
The latest surge in FTT follows a recent report that FTX’s bankruptcy estate has offloaded 22 million shares of Grayscale’s GBTC bitcoin exchange-traded fund (ETF). At the time of the sales, the shares were worth approximately $1 billion and represented almost 50% of all GBTC sales since the investment vehicle started trading earlier this month.
With these sales, claims on FTX deposits exceeding $1 million have continued to rise. As of January 12, the price of FTX claims was two points higher than the previous week, indicating a significant increase in value within a short period.
According to Claims Markets, a company specializing in tracking bankruptcy claims, this increase is fueled by optimism among creditors due to an upcoming hearing where the court will estimate the value of each claim.
FTT was trading at $2.66 at the time of writing, representing a 5.9% increase in the past 24 hours. At the same time, the broader market is down 4%.
FTX Bankruptcy
FTX is undergoing proceedings in the US after its disgraced founder, Sam Bankman-Fried (SBF), filed Chapter 11 bankruptcy for the company in November 2022. The Chapter 11 was filled after Bankman-Fried and his associates misappropriated customers’ deposits on the exchange.
Since the bankruptcy filing, new management has made significant efforts to recover assets and make customers and creditors whole. Last year, FTX’s new CEO, John J. Ray III, estimated that the exchange had recovered $7 billion in assets, including $3.4 billion worth of cryptocurrencies.
FTX liquidators are already in the process of selling the company’s assets. Coinfomania revealed in November that the liquidators moved $20 million worth of crypto assets to multiple exchanges, signaling a sell-off.
