Bankrupt FTX recovered over $5 billion in cash and ‘liquid’ assets, attorney says

Crypto exchange FTX has recovered over $5 billion in cash and other liquid assets, an attorney representing the bankrupt Sam Bankman-Fried’s founded company told a judge on Wednesday.

According to the lawyer, the $5 billion includes cash and digital assets, attorneys said during the FTX bankruptcy hearing Wednesday. The disclosure comes a few days after U.S. federal prosecutors announced plans to seize at least $500 million worth of FTX-connected assets in connection with their ongoing prosecution of FTX co-founder and former CEO Sam Bankman-Fried.

This recovery is welcoming news for FTX investors and customers, who have collectively lost billions of their life savings in the company.

“We have located over $5 billion of cash, liquid cryptocurrency and liquid investments securities,” Andy Dietderich, an attorney for FTX, told a U.S. bankruptcy judge in Delaware at the start of Wednesday’s hearing.

FTX attorney Adam Landis told the court that the $5 billion figure regards “any value to holdings of dozens of illiquid cryptocurrency tokens, where our holdings are so large relative to the total supply that our positions cannot be sold without substantially affecting the market for the token,”

FTX filed for bankruptcy in November of last year. According to multiple court documents, bankrupt crypto exchange FTX currently owed a total of about $3.1 billion to more than 1 million people, making it “impracticable” to contact each victim. The U.S. government has launched a website for FTX victims to communicate with law enforcement.

In papers filed at a New York federal court, federal prosecutors in Manhattan “asked U.S. District Judge Lewis Kaplan for permission to use the website to notify victims, rather than contacting each individually,” Reuters reported Friday.

The U.S. federal law requires prosecutors to contact possible crime victims to inform them of their rights, including the rights to obtain restitution, be heard in court, and be protected from defendants. Although U.S. District Judge Lewis Kaplan has not yet ruled on the request, the website went live by Friday afternoon. In a statement, the website read:

“If you believe that you may have been a victim of fraud by Samuel Bankman-Fried, A/K/A/ ‘SBF,’ please contact the victim/witness coordinator at the United States Attorney’s office.”

Last week, the disgraced FTX founder Bankman-Fried, 30, pleaded not guilty to federal fraud charges to eight federal fraud charges related to the collapse of the now-bankrupt crypto exchange FTX. His trial is set for October 2.