Since FTX declared bankruptcy a year ago, the price of cryptocurrencies has dropped, venture capital funding for cryptocurrency firms has dried up, the number of CEO arrests has increased, and authorities’ inquiries have increased. In the meanwhile, FTX is trying to recover.
Three bidders have submitted offers to the digital currency exchange, one of which includes the possibility of reopening trade. Next month, a winner is anticipated to be chosen. With over 9 million clients, the corporation even had the option to restart without a partner.
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Sam Bankman-Fried, who was convicted of fraud on November 2, will not take part in this. His initial criminal convictions entail a possible sentence of more than 100 years.
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He is awaiting sentencing for these offences and may face a second trial in March on allegations of international bribery and violating campaign finance laws.
Crypto hubris in the past was typified by Lamborghinis, boat parties, and multimillion-dollar NFT deals. The hubris to consider bringing up the defunct exchange FTX is now apparent.
There are more indications of market optimism. For the first time since May 2022, the price of Bitcoin topped $35,000 last month. Many people believe that the regulatory frameworks created by the UK, Dubai, the EU, and Hong Kong are more hospitable to the business. Within the next few months, US authorities may approve the first exchange-traded fund backed by Bitcoin.
An FTX strategy would need a lot of things to work. The sum of customer claims is $16 billion. The notion that a resurgence may draw enough interest and yield enough profits to partially offset the lost capital is dubious at best, particularly given how uncertain a cryptocurrency rebound is.
Artificial intelligence, however, offers FTX’s creditors even another hope. FTX’s holding in the artificial intelligence firm Anthropic is regarded as one of its most significant investments.
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A few weeks ago, Anthropic secured a $2 billion financial commitment from Google in addition to the funds it had previously gotten from Amazon.com Inc.
The surge in AI has given creditors optimism that a sale of the stock may bring in enough money to make them whole. However, selling private business shares may be challenging, and investing in a popular startup is essentially taking a new sort of risk.
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