SBF: rumors circulate about possible FTT issues for FTX creditors
SBF: rumors circulate about possible FTT issues for FTX creditors
Crypto

SBF: rumors circulate about possible FTT issues for FTX creditors

By Andrea Porcelli - 9 Dec 2022

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Rumors are circulating on Twitter regarding a possible issuance of the FTT token to repay Sam Bankman Fried‘s (SBF) creditors after the failure of FTX. 

Obviously, this news has sparked much discussion in the Twitter community. Excluding the veracity of the facts, investors no longer trust the former FTX CEO. 

The news is already causing a stir, despite the fact that it is only a rumor and has not been confirmed by anyone, neither by SBF nor by new FTX CEO John Ray III. 

Beyond that, the FTT token opened higher this morning, perhaps influenced by this news.

Is SBF’s move to issue new FTTs to FTX’s creditors really possible?

Sam Bankman Fried (SBF) has recently been very vocal in a variety of interviews. The former FTX CEO was able to clarify many issues, although just as many are still unresolved.

The main point of SBF’s interviews is to clarify that behind the collapse of FTX, there was no fraud attempt. According to SBF, the causes of the exchange platform’s collapse are related to mismanagement, miscalculations, and a high risk bias, and not instead to an attempt to defraud FTX’s creditors. 

Rumors circulating, however, see Sam Bankman Fried willing to issue new FTT tokens in order to repay its creditors. The rumors circulating see a new startup of the FTX exchange, the issuance of new FTT tokens and the distribution of the token to the creditors, in this way one could make the creditors their money back.

While the goal is to repay investors, this kind of move seems to be impossible to implement for a variety of reasons. First, investors no longer trust Bankman Fried’s bold moves.

Twitter discussions see the former CEO with very few fans. More importantly, the administration of the FTX exchange platform is no longer in the hands of Sam Bankman Fried, but rather its new CEO John Ray III. 

All operations, particularly fund management, fall to the new CEO and his team that specializes purely in corporate liquidations and bankruptcies. 

Recently, the new CEO of FTX, found himself speaking to microphones to clarify the issue once and for all: SBF and other members of his inner circle, including former Alameda Research CEO Caroline Ellison, are no longer involved in the company’s operations, despite SBF’s recent externalizations about an alleged plan to return funds to clients. From this it can therefore be deduced that the news that leaked out recently is unfounded, as Sam Bankman Fried is not allowed to operate on behalf of FTX. 

All the rumors and assumptions made by Sam Bankman Fried are no longer about FTX’s company. Although SBF is its founder, the company is currently in liquidation, and John Ray III’s main thought is to raise as much money as possible to restore debts and pay whoever is owed.

John J. Ray III stated: 

With the Court’s approval of our first-day motions, we are moving forward as quickly as possible in our efforts to maximize value for all FTX stakeholders. We will continue to work to implement the necessary controls and protect and deploy the Company’s assets. As we review the business, we have already begun to receive interest from potential buyers for our assets and will conduct an orderly process to reorganize or sell FTX assets worldwide for the benefit of stakeholders.”

Meanwhile, the price of FTT rises 

This morning the price of the FTT token of the failing company FTX boomed significantly. This price increase probably stemmed from the rumors that have been circulating on Twitter. The price saw an increase of about 40 percent, from $1.3 to about $2.  

There is, however, also a risk that this is a way to liquidate assets without a desire to use them again by refounding the exchange. In that case the FTTs would lose much of their value again.

As usual, nothing can be predicted regarding market trends, and the prices of tokens such as FTT. What is known is that FTX is still inside the eye of the storm: there are still many issues to be resolved and the future of the company is in the hands of John Ray III. 

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