Image source: The Block
FTX, the renowned cryptocurrency, has been in a heap of trouble in the past few weeks.
According to documents filed in Delaware bankruptcy court last Saturday, FTX owes $3.1 billion to its top 50 creditors.
While names were not mentioned, the document clarifies the scope of the potential losses clients face.
The filing
According to the Saturday filing, the crypto exchange’s top ten creditors have more than $100 million each in unsecured claims.
The claims equal more than $1.45 billion combined.
The filing explained that the debt doesn’t involve anything owed to company insiders.
However, it is subject to change with more information.
FTX owes over $276 million to its largest creditor.
Meanwhile, the company owes around $21 million to the 50th-largest creditor.
Despite the titanic debt, the filing may only be scratching the surface of what the company owes.
Last week, FTX explained that it could have more than a million creditors.
The company owes the third-largest creditor $174 million.
Although unconfirmed, the figure aligns with what Genisis, a cryptocurrency lender, disclosed ten days ago: $175 million of funds locked in its FTX trading account.
Read also: FTX investigated by Bahamas police for possible misconduct
Filing notice
A notice attached to the filing explains that FTX based the totals on information that can be viewed but wasn’t accessible.
The notice states that the company has been unable to access customer data fully.
FTX, under the management of new Chief Executive John J. Ray III, stated in the motion that its debt figures might be inaccurate.
There may be payments to creditors that don’t reflect the company’s books or records yet.
Creditors
A related motion was filed to withhold information about the FTX creditors and their personal information.
The motion states that revealing creditors’ names could tip off predatory firms.
It reads:
“Public dissemination of the Debtors’ customer list could give the competitors an unfair advantage to contact and poach those customers, and would interfere with the Debtors’ ability to sell their assets and maximize value for their estates at the appropriate time.”
“The Debtors historically did not keep appropriate books and records,” it continued.
“[And] the Debtors are currently working to access certain sources of data and records that are currently unavailable.”
Read also: Sam Bankman-Fried puts out Argentina rumors
Chapter 11 cases
The decision to create a list of FTX’s creditors came from overlapping creditors across its Chapter 11 cases, disorganized recording keeping, and limited time and resources.
“Creditor information, and in particular customer information, is not clearly labeled or identifiable by [FTX],” the motion reads.
“As a result, presenting the information on a consolidated basis will ensure the most relevant and known information can be promptly disclosed.”
A date for the “First Day Hearing” of FTX’s bankruptcy case is ready.
It will happen in Wilmington, Delaware, on Tuesday.
Reference:
FTX says it owes over $3 billion to its 50 largest creditors
