How Crypto Bankruptcy Claims Buyers Will Profit From the Collapse of FTX

From 3AC to FTX (and possibly more to come), it’s boom times for those trading crypto bankruptcy claims. Thomas Braziel, founder and CEO of 507 Capital, gives a crash course on bankruptcy law, offering the latest updates on the FTX, Celsius, and Three Arrows Capital cases. Plus, insight on how 2023 could finally be the year Mt. Gox creditors get (some) closure.

Show highlights:

• how Tom got into crypto with the Mt. Gox bankruptcy and whether “crypto distressed” is an emerging asset class
• how buying bankruptcy claims is also a way to buy crypto assets at a discount
• how to determine how much value creditors are owed in a crypto bankruptcy
• what the marketplaces for buying and selling claims are like
• whether it’s possible to tokenize bankruptcy claims
• whether crypto tokens should be treated as property
• what is likely to happen when Mt. Gox creditors are returned their BTC
• the importance of Celsius’ separation of custodial assets vs. assets in interest-bearing accounts
• the likelihood of Celsius being acquired
• why the fact that FTX recovered $5 billion in assets is “amazing”
• why so many stakeholders disputed the ownership of the $450 million in Robinhood shares
• why there’s so much difference in the prices of FTX, Voyager, BlockFi and Celsius claims
• whether the customer list of FTX should be kept private
• what type of creditors are Gemini Earn customers

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Links

Guest:

• Thomas:
  • Twitter
  • 507 Capital
  • Previous appearances on Unchained:
    • Will FTX Customers Ever Recover Their Assets? Two Insolvency Experts Weigh In
    • Will Celsius Survive the Bankruptcy Process?

Episode Links: 

Celsius

• Reuters:

• • U.S. judge says Celsius Network owns most customer crypto deposits
  • Celsius bankruptcy judge orders return of some crypto assets to customers
• Bloomberg: Bankrupt Crypto Lender Celsius Receives Multiple Bids for Retail and Mining Assets

FTX

• Unchained:
  • DOJ Seizes $450M in Robinhood Shares from FTX
  • Bankrupt FTX Recovers Over $5B Worth of Assets: Report
• CoinDesk: 
  • FTX Creditor Claims Going for 13 Cents on the Dollar on Bankruptcy Marketplace Xclaim
  • After Bankruptcy, FTX User Claims Pay Cents on the Dollar
• Fortune: Sam Bankman-Fried’s lawyers just filed a claim to keep his $450 million in Robinhood shares
• Reuters: U.S. Trustee files objection to FTX’s planned asset sales
• Thomas Braziel’s prediction on the FTX claims
• Connor Grogan’s take on the $5 billion in assets 

DCG/Gemini:

• Unchained: Gemini Ends Its Earn Program and Calls for Barry Silbert’s Ouster

3AC

• Kyle Davies’ comments