K33 Highlights Bullish Potential of FTX Payouts

Payouts in fiat to FTX creditors could trigger positive “buyer pressure” in the cryptocurrency market, according to a report by K33 Research.

Under the proposed plan by the exchange, the total payout value will range from $14.5 billion to $16.3 billion. Analysts believe these funds are likely to create a “bullish overhang.”

“Not all creditor settlements are bearish,” the experts noted.

K33 compared FTX’s cash compensations with cryptocurrency-based payouts from Mt.Gox and Gemini—the combined debt of the latter two is “currently estimated at $10.6 billion.”

According to analysts, it is “impossible” to predict the impact of the compensations on the market in advance, making the timing of payouts a key element in forecasting.

The repayment of $1.7 billion by Gemini is scheduled for early June, while the deadline for the $8.9 billion payout from Mt.Gox is set for October 2024.

“The different dates of these payouts represent yet another sign of a slow summer in the market and a confident end of the year,” the researchers added.

In April, K33 experts highlighted the risks for Bitcoin from Mt.Gox payouts. They believe that the prospect of selling 142,000 BTC could “frighten the market.”

Uncertainty remains regarding FTX, as the court has yet to approve the repayment plan.

Earlier, a representative of the largest group of affected exchange clients, Sunil Kavuri, opposed the new compensation model, arguing that it limits recipients’ options and absolves some defendants of liability.