FTX and Alameda Research must pay $12.7 billion to creditors

It is now official: FTX's management must repay the embezzled $12.7 billion. For the crypto world, this is good news.

The bankrupt crypto exchange FTX must repay a total of $12.7 billion to its creditors. The U.S. regulator CFTC had filed a lawsuit to do so.

This was stated by the competent court yesterday, on Aug. 7, private.

In addition, the court ruled that FTX and Alameda may no longer operate as financial intermediaries, such as exchanges.

FTX was one of the largest Bitcoin exchanges in the world. In 2022, the exchange founded by Sam Bankman-Fried went spectacularly bankrupt.

Alameda Research was a trading company also founded by Sam Bankman-Fried. In late 2022, it was revealed that management around Bankman-Fried had speculated with customer funds and embezzled billions through unauthorized transfers between Alameda Research and FTX.

Those in charge are up to long prison sentences. Sam Bankman-Fried, for example, was sentenced to 25 years in prison on March 28, 2024.

The bankruptcy process has been ongoing since Nov. 11, 2022.

For the crypto world, the court ruling is good news. Ultimately, some of the refunds are expected to flow back into Bitcoin and other cryptocurrencies.