Crypto social media is buzzing with FUD (fear, uncertainty, and doubt) about supposed imminent FTX distributions, but let's clear the air—there's no need to hit the panic button just yet.
Rumors are flying around that FTX, the troubled exchange, is about to distribute a whopping $11 billion to creditors starting October 1st. Influencers like “MartyParty” are urging their 116,000 followers to dump their ETH, ADA, and DOT in anticipation, while hyping up SOL and SUI. Meanwhile, crypto advisor Dan Held, with his 720,000 followers, is claiming that $16 billion in FTX distributions will kick off tomorrow, although he believes the degens will likely buy right back in. “Crypto Rover” is also spreading the FUD to his 840,000 followers, suggesting distributions are imminent.
But hold your horses! The reality is far from what these rumors suggest. According to official documents, FTX's legal team is scheduled for a court hearing on October 7th to finalize the repayment plan. So, no distributions are happening this week, folks.
If the revised plan gets the green light, smaller claims under $50,000 might start seeing distributions by the end of 2024. Larger claims? Well, they may have to wait until the first or second quarter of 2025.
FTX creditor activist Sunil Kavuri has also chimed in, calling out large accounts for spreading false info. He estimates that about half of the claims, roughly $5.5 billion, won't be reinvested in crypto.
In June, creditors led by Kavuri objected to repayments favoring in-kind assets over cash, which would be taxable. CNBC crypto trader Ran Neuner also debunked the FUD, stating that distributions would start within 60 days of the plan becoming effective.
Despite the baseless FUD, crypto markets took a hit during Monday morning trading in Asia. Total market capitalization dropped by 2.7%, with Bitcoin sliding to $64,500 after peaking at $66,000 over the weekend.
Interestingly, FTX's native token, FTT, has surged over 50% in the past 24 hours, reaching a seven-month high of $2.70 on Sunday before settling at $2.19—still up 51% for the day. FTT has gained over 70% in the past two weeks, fueled by reimbursement rumors. However, it remains down a staggering 97.5% from its all-time high of $84 in September 2021.
So, keep calm and HODL on!
