FTX Customers Dispute Team’s Claim of “Samcoin” Worthlessness, Arguing for Multi-Billion Dollar Valuation

FTX Customers Dispute Team's Claim of "Samcoin" Worthlessness, Arguing for Multi-Billion Dollar Valuation

FTX Customers Dispute Team's Claim of "Samcoin" Worthlessness, Arguing for Multi-Billion Dollar Valuation

According to Bloomberg, a small group of FTX clients who hold “Sam Coins” are demanding hundreds of millions of dollars from the bankrupt cryptocurrency company, claiming that even though these coins are closely associated with convicted founder Sam Bankman-Fried (SBF), the holders should be compensated.

Investors holding tokens such as Serum (SRM), Maps (MAPS), and Oxygen (OXY) are requesting Judge John Dorsey of the US Bankruptcy Court to reject the company’s expert conclusion that these cryptocurrencies are nearly worthless, forcing FTX to increase the value of these coins. Court documents show that before relinquishing control of FTX, SBF created Serum and gained control of the other two tokens through transactions.

These clients and FTX presented their final arguments in court on Tuesday, the 26th, with Dorsey not revealing when a ruling will be made.

Points of contention
Judge Dorsey asked both parties how they assess the value of cryptocurrencies, stating that unlike property or stocks, tokens have “no intrinsic value” and “here, the only value derives from the trading itself. As far as I know, cryptocurrency trading is based on emotion, nothing else.”

FTX argued in a court document that when FTX filed for bankruptcy in November 2022, the company held over 95% of the disputed tokens, far exceeding the amount that could be sold, even if these tokens were not tainted by fraudulent activities that led to FTX’s collapse. FTX’s advisors have requested the judge’s approval of their estimation, which states that two of the coins have no value, and the third coin is only worth a few cents.

Token holders claim that this estimation is flawed and presented their own method of calculating token value in court. According to their method, these cryptocurrencies should be valued at hundreds of millions of dollars. These clients have filed claims demanding repayment based on their calculation results.

Counsel for the creditors, Kurt Gwynne, told the judge that FTX hired experts to evaluate the tokens but took measures to ensure that the valuation was as low as possible. He stated, “Every instruction from FTX was to depress the values.”

Additionally, FTX’s lawyer stated that other former FTX clients are likely to recover 100% of their funds on the platform because the dollars, bitcoins, and other assets they invested are still valuable today. The company also claimed to have approximately $6.4 billion in cash.