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Tech and Media Companies Among FTX Creditors in Bankruptcy

The economy is interdependent. When one major bankruptcy happens, it affects sectors across the country. For FTX, a major crypto investing firm, many of their major investors were West Coast companies in the tech industry or those with ties to entertainment like Netflix. These companies are now listed as creditors in the FTX bankruptcy, and it is broadly believed that they will see only a tiny fraction of what was lent. 

The inclusion of these companies in the bankruptcy filing indicates that FTX owes them money. However, it is not clear how much money they owe each company. In many cases, FTX cut deals with major media companies for advertising space. So, it may be that they have yet to pay for the airtime. Many of the listed companies are media companies, and FTX may still be on the hook for the bill. 

Will FTX Pay This Money Back?

The matter has been taken out of FTX’s hands and placed into the hands of a transitional CEO who is now attempting to fix all of the problems caused by the former leadership. As of now, the interim CEO is less concerned about FTX’s vendors than he is with FTX’s customers who used their platform to invest and hold crypto deposits. As of right now, these customers have not had access to their assets since FTX declared bankruptcy and froze them. The customers’ assets have now become a part of the bankruptcy estate, and the interim CEO, along with the trustee, is attempting to recover money in order to make the customers whole. At this point, vendors are the lowest on the list as far as compensation goes.

This could create a problem for West Coast businesses that are owed money from FTX, but it appears unlikely to cause a major tremor in the industry. Media and tech remain strong, with new innovations in AI poised to open new possibilities. 

In What Order are Creditors Paid Back?

In a case like this, the customers would be paid back first, with secured creditors next and unsecured creditors last. In this case, Comcast, Apple, and Twitter are listed as unsecured creditors, but the speculation is that debt is related to advertising fees and nothing that will bottom out the industry. 

FTX was meant to operate as a crypto exchange and back. Customers who had their digital assets stored on that platform woke up one morning to find that they could not access their funds. This caused the entire crypto market to collapse, with customers unsure they would ever receive a dime in return. Meanwhile, there are allegations that Bankman-Fried attempted to defraud the bankruptcy process by repaying some overseas investors first. So, the situation is a mess and remains so.

Talk to an Indiana Bankruptcy Attorney Today

Chris Arrington helps residents solve crippling debt problems. Call today to schedule a free consultation, and we can discuss your best strategy immediately. 

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