FTX Pushes for Zero Valuation on Cryptocurrencies Linked to Sam Bankman-Fried in Bankruptcy Court
In a recent court session on March 26, FTX made a bold move by suggesting that certain cryptocurrencies linked to founder Sam Bankman-Fried have no real value. The firm’s attorney, Brian Glueckstein, targeted specific digital assets, including Maps (MAPS), Oxygen (OXY), Serum (SRM), and Boba (BOBA), also known as “Sam Coins,” proposing that their value should either be significantly devalued or dropped to zero.
The argument for zero valuation was supported by FTX’s valuation expert, Sabrina Howell, who highlighted the firm’s dominant ownership of these tokens. Howell noted that FTX holds over 95% of the maximum supply of OXY and MAP tokens, making it nearly impossible to liquidate them in a reasonable timeframe. As a result, the claims of these tokens, valued at over $600 million, were deemed to have no worth.
Similarly, claims of SRM tokens, amounting to $509 million, were recommended for a 58% devaluation. However, holders of these “Sam Coins” have disputed FTX’s valuation, insisting that their combined worth exceeds $1.1 billion.
Delaware bankruptcy court Judge John Dorsey has yet to make a decision on the matter, acknowledging the complexity of crypto valuation. He emphasized that the value of cryptocurrencies is derived from trades based on sentiment rather than tangible assets.
Meanwhile, Sam Bankman-Fried, the disgraced founder of FTX, faces a potential 50-year prison sentence following his conviction on fraud charges. His legal team has requested a reduced sentence, with the sentencing scheduled for March 28.
As FTX navigates through its bankruptcy proceedings, the debate over the valuation of cryptocurrencies linked to its founder underscores the challenges of assessing digital asset worth in the crypto industry. Stay tuned for updates on this developing story.
