I’ve been getting legal mails for the entire process since I had like 0.000000000003 cents in a wallet called blockfolio that was acquired by FTX which was pretty funny to follow
FTX creditors will make money on bankruptcy
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Re: FTX creditors will make money on bankruptcy
#52The people that sold their stakes to people like Scott Galloway must be kicking themselves. Great trade. https://www.youtube.com/watch?v=TPFiRlZaclQ
Galloway says he bought $1mn claim for $270k. That's a nice ~4.5x profit.
looking at individual investments is fallacious, need to look always at your entire portfolio (i.e. not just winning lottery tickets)
Re: FTX creditors will make money on bankruptcy
#53Earlier quoted context omitted.
I fail to see how the decision was anything less than decisive prudence. Your cited article makes it abundantly clear that the provenance of said $17 million claim was a default clause entitling Miami-Dade County to three years worth of naming-rights fees. They sold that speculative claim for $5 million cash---effectively recovering that year's otherwise uncollectible receivables---then immediately turned around and…
The overarching question is: why should the County have thought the hedge funds are overpaying for the claim and to take the money and run? Usually when you have several suitors that purely have profit in mind, you're the mark. Doubly so when their cost of capital is higher than your own. > to allocate expensive legal resources in chase of speculative claims On a claim this big, the bankruptcy trustee takes care of t…
They don't have to be overpaying. It was a win win. The way I read it the county got more money this way than if they held it.
They they sold the stake ultimately worth 17 million, but they got their rights back, which they resold for 16 million. As long as they sold their stake for 1 million or more, they are in the green.
Re: FTX creditors will make money on bankruptcy
#54Earlier quoted context omitted.
Galloway says he bought $1mn claim for $270k. That's a nice ~4.5x profit.
looking at individual investments is fallacious, need to look always at your entire portfolio (i.e. not just winning lottery tickets)
While that's true, if you have a good understanding of bankruptcy law, and a reasonable understanding of what assets FTX owned you could make a reasonable guess of how much money the eventual bankruptcy would pay out. Since the administrators publicly published what assets there were quite early on I think it's fair to say $270k always looked like a good deal.
Re: FTX creditors will make money on bankruptcy
#55I bought a Solana NFT that I never took off of FTX. Anyone know if I can do anything about that?
What’s the current fair market value of a “solana NFT”?
Re: FTX creditors will make money on bankruptcy
#56Dumb question: why are creditors getting paid more than they are owed?
This was covered in some of the coverage much earlier about the bankruptcy proceedings. Essentially it's within the court's power to not only pay the creditors but to pay them interest on their losses if that's possible. That's obviously balanced against the rights of the equity holders to get back any value if there is any equity left. In this specific case the people with equity were: the fraudsters who ran the scam, venture capitalists. No one wants to pay off the fraudsters and the VCs would rather pretend this whole thing didn't happen (because it makes them look like drunken coked up degenerate gamblers on a weekend at Vegas) so everyone agreed the court should be generous with how they calculate the return to customers. Government entitires also have a claim for any fines or taxation or whatever, but they're relatively happy for the retail customers to be protected first too - but they care less about the equity getting wiped out.
My guess would be anything above what the customers get may well go out to government fines rather than returning to the equity holders.
Re: FTX creditors will make money on bankruptcy
#57I keep seeing this "headline" and it is the very definition of fake news. If you held SOL on FTX they will pay you at the Nov 2022 prices which was under 9 per SOL. It is trading at ~150 now.
Bitcoin was trading at 17k, it is now 62k.
FTX creditors didn't hold US dollars. They held crypto. A good chunk didn't even buy any of the crypto WITH US dollars. Many are in countries that US dollars is not legal tender.
Guess what they're getting back for their claims?
You guessed it. US Dollars.
Re: FTX creditors will make money on bankruptcy
#58The statement is misleading. People are making 18% interest on the value of Bitcoin et al. at the value of 2022, which is less than $20k. Now that is $60k, back to the value levels of 2021. Thus, the only reason there is interest is that the cryptocurrencies found gained back their value, and the bankruptcy court gets to consider the values when the bankruptcy started in 2022, not current/before 2022 values.
I struggle to see the issue with the headline, this is how bankruptcy works, it's how they would usually report in relation to creditors.
Re: FTX creditors will make money on bankruptcy
#59I keep seeing this "headline" and it is the very definition of fake news. If you held SOL on FTX they will pay you at the Nov 2022 prices which was under 9 per SOL. It is trading at ~150 now. Bitcoin was trading at 17k, it is now 62k. FTX creditors didn't hold US dollars. They held crypto. A good chunk didn't even buy any of the crypto WITH US dollars. Many are in countries that US dollars is not legal tender. Guess…
I held mainly dollars on the exchange at the time. I see your point regarding the crypto holders on the exchange though.
Re: FTX creditors will make money on bankruptcy
#60Earlier quoted context omitted.
That's not how any of this works. If you steal money from the cash register to bet it all on black in Vegas, you're still going to jail even if you happen to hit and be able to return what you took.
That is, coincidentally, how we still have FedEx. Fred Smith taking the company's last $5K to Vegas and luckily winning $27,000. Mind you at that point, pilots were putting fuel on their personal credit cards, payroll had been bouncing for weeks. (Funnily, some people here think he did the right thing.)
> That is, coincidentally, how we still have FedEx. Fred Smith taking the company's last $5K to Vegas and luckily winning $27,000.
The difference is it was the companies money - not FedEx customers.