A number of distressed debt investors, including Attestor, Farallon Capital and Oaktree Capital, are set to benefit from bets that creditors of FTX Capital will recover more than expected, following the collapse of the cryptocurrency exchange.
While initial estimates in late 2022 were that claims would see clients recover just a few cent on the dollar, in a recent legal hearing, an FTX lawyer told a US bankruptcy judge that the firm was on track to repay creditors in full, leaving investors in claims that traded for as little as 10% of their nominal value in line for a bumper pay day.
The report cites a US Chapter 11 court document filed earlier in the year as revealing distressed debt specialist Attestor as holding the largest position in FTX claims with around $394m at the end of January, while other creditors include Baupost Group, Farallon Capital and Oaktree Capital, according to the filing and people familiar with the matter.
The success of FTX advisers in tracking down billions of dollars of the company’s assets, coupled with a big increase in the value of crypto, and in particular bitcoin, which is now standing at around $65,000, up from $16,000 in November 2022, means that there is n ow more than $6bn in the FTX pot with the company still in the process of selling assets. FTX also reportedly owns a stake inn AI company that could be worth up to an additional $1bn.
