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It should be noted that the American system also does not give FTX creditors this kind of windfall - under US bankruptcy law, their claims were effectively conv

It should be noted that the American system also does not give FTX creditors this kind of windfall - under US bankruptcy law, their claims were effectively converted to dollars at the time of the bankruptcy, and they see no benefit from increased crypto prices since then. I'd assume this simplifies administration a lot, contributing to a faster resolution, but many FTX creditors are unhappy about it: https://www.wired.com/story/ftx-creditors-crypto-payout-rejection/ https://www.wired.com/story/ftx-creditors-crypto-payout-reje...

wmf 2y ago
It's weird that people who had dollars on FTX can get 118% back but crypto "has to" take a massive haircut.
- FireBeyond 2y ago
  Generally, you're not entitled to potential losses as a bankruptcy creditor. Those creditors were welcome to sue the entity in bankruptcy for their potential losses, but that would involve demonstrating they'd have had the wherewithal to hold to the point of the gains they're claiming. I do think that FTX creditors should not have profited out of the bankruptcy proceedings, either.
Lerc 2y ago
This is what initially happened with MTGox as well. The subsequent increase in value complicating things is a large part of why the MTGox resolution has taken so long. The original plan to reimburse the yen value of claims at the time of collapse was no longer a fair solution. The payout due now was proposed and voted on by the claimants. The process has been slow but very methodical, at each stage there were long periods where they gave claimants time to respond. I, for one, would not like to be in charge of pressing the button that distributes several billions of dollars to thousands of different people without it fucking up. If someone is doing that this July you would hope that they have dotted all their Is and crossed all their Ts.
- antifa 2y ago
  I'm ready for the button presser to say "Oops! I got hacked, sorry it's all gone again."

wmf 2y ago

It's weird that people who had dollars on FTX can get 118% back but crypto "has to" take a massive haircut.

FireBeyond 2y ago
Generally, you're not entitled to potential losses as a bankruptcy creditor. Those creditors were welcome to sue the entity in bankruptcy for their potential losses, but that would involve demonstrating they'd have had the wherewithal to hold to the point of the gains they're claiming. I do think that FTX creditors should not have profited out of the bankruptcy proceedings, either.

Lerc 2y ago

This is what initially happened with MTGox as well. The subsequent increase in value complicating things is a large part of why the MTGox resolution has taken so long. The original plan to reimburse the yen value of claims at the time of collapse was no longer a fair solution. The payout due now was proposed and voted on by the claimants. The process has been slow but very methodical, at each stage there were long periods where they gave claimants time to respond. I, for one, would not like to be in charge of pressing the button that distributes several billions of dollars to thousands of different people without it fucking up. If someone is doing that this July you would hope that they have dotted all their Is and crossed all their Ts.

antifa 2y ago
I'm ready for the button presser to say "Oops! I got hacked, sorry it's all gone again."