FTX sells all Crypto to increase the amount of cash to repay customers

Cryptocurrency exchange FTX doubled its cash holdings in just the last two months of 2023 as it accelerated the pace of asset liquidations. Great

Cryptocurrency exchange FTX doubled its cash holdings in just the last two months of 2023 as it accelerated the pace of asset liquidations. According to information from Bloomberg, the FTX cryptocurrency exchange has increased the sale of cryptocurrencies to accumulate more cash. This action is intended to mobilize additional capital to serve a compensation plan for users after court approval of a plan to liquidate crypto assets worth 3.4 billion USD in September 2023.
As a result, the amount of cash held by FTX has increased dramatically from 2.3 billion USD at the end of October to 4.4 billion USD at the beginning of 2024, thanks to the great efforts of four branches. FTX's largest branch, including FTX Trading Ltd. and Alameda Research LLC, have played a key role in boosting the group's cash position. Thus, this action shows that FTX is very serious in restructuring assets and strengthening financial resources. In addition to selling cryptocurrency, FTX has also sold up to 1 billion USD of GBTC shares since this product was allowed by the US SEC to convert into a Bitcoin spot ETF in mid-January 2024.

This shows FTX's flexibility and strategy in optimizing investment and business opportunities. In addition to selling cryptocurrencies, FTX is also establishing hedge positions in Bitcoin and interest-bearing investments using other coins to increase the amount of money it can collect. This shows FTX's flexibility and creativity in finding alternative sources of income and diversifying risks. In addition, FTX is also considering feasible options to restart trading activities, in order to create a stable and sustainable source of income in the future.

Thanks to the recovery of the cryptocurrency market in the last quarter of 2023, the number of assets that FTX can recover has grown impressively, along with the value of its clients' assets. According to Bloomberg statistics, FTX customers' right to claim assets worth $1 million or more increased from 0.38 cents per $1 to 73 cents at the end of last week. This shows trust and good service from FTX to customers. FTX's representative admitted that they could not completely compensate 100% of their assets for their customers.

So the company has proposed a model that pegs the value of customers' assets at the time of bankruptcy filing in November 2022. This approach has been met with opposition from many FTX clients, who argue that it will cause them to miss out on significant gains from the market's growth over the past year, especially the price increase. Bitcoin extends into 2023 and the resurgence of other tokens. In summary, the FTX cryptocurrency exchange is making positive moves in restructuring assets, strengthening financial resources and finding alternative sources of income. However, more transparency and fairness in the investor compensation process is needed to create trust and stability in the cryptocurrency market.