When FTX fell, many victims engaged in a self-flagellation of sorts, upbraiding themselves for their credulity. Windhagen lost a fifth of his net worth—not enough to ruin him financially, he says, but “enough to really hurt.” He had always been suspicious of personality cults, but for whatever reason, did not “adjust his risk assessment” for Bankman-Fried. Folkvang had half of its assets on FTX, worth tens of millions of dollars.
The brands that Bankman-Fried had for years so carefully curated—both his own and FTX’s—fell to pieces in the span of a week. In anof the push to restart FTX is unclear. It’s possible multiple parties came to the idea at once. But in January, astarted a discussion. Sunil Kavuri, an FTX creditor with a background in finance, valued the exchange at roughly $8 billion, based on transaction volumes for the previous year.
Kavuri proposed a debt for equity swap. The FTX exchange would be auctioned off to outside investors who would inject capital to get it back on its feet, and those owed money by FTX would be given a stake in the new exchange. If FTX 2.0 succeeded thereafter, the value of each creditor’s equity might some day exceed the amount they originally lost, creating an incentive for those people to use it.
The plan to reboot the exchange has its detractors. The main objections revolve around the damage done by Bankman-Fried to the FTX brand and the cost to an outside investor of rebuilding a viable business from the wreckage. compiled in the wake of the collapse, after all, suggested FTX had next to none of the accounting, data security, and corporate governance systems one might expect of a legitimate business, so what precisely would an investor be purchasing?
Law Law Latest News, Law Law Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Source: Reuters - 🏆 2. / 97 Read more »
Source: CoinDesk - 🏆 291. / 63 Read more »
Source: CoinDesk - 🏆 291. / 63 Read more »
Source: Reuters - 🏆 2. / 97 Read more »
Source: CoinDesk - 🏆 291. / 63 Read more »
Source: TheBlock__ - 🏆 464. / 53 Read more »