• The crypto exchange FTX collapsed last year, causing a contagion among several companies exposed to the distressed exchange.
• Digital Surge, an Australian crypto exchange, was one of the affected firms, with about $23.4 million in digital assets locked in on the FTX platform.
• Digital Surge proposed a Deed of Company Agreement (DOCA) which requires the creditors’ approval, with the founders contributing $1 million from another private source to the firm.
Last year’s collapse of the crypto exchange FTX shook the entire industry. FTX had been one of the top exchanges in the industry, with many investors and firms as users. Unfortunately, due to the filing for bankruptcy, investors lost access to their funds on the platform, which caused a spreading contagion among several companies exposed to the distressed exchange.
One of the affected firms was Digital Surge, an Australian crypto exchange with about $23.4 million in digital assets locked in on the FTX platform. In order to protect their users, Digital Surge suspended withdrawals on their platform as a precautionary measure. They also worked on all possible options to help recover the locked funds on FTX.
On December 8, 2022, the directors of Digital Surge contacted their customers through email about a rescue plan for their fund recovery. The plan proposed a Deed of Company Agreement (DOCA), which required the creditors’ approval. The founders of Digital Surge, Daniel Rutter and Josh Lehman, agreed to contribute $1 million from another private source to the firm. This was to help support their efforts in repaying all their customers. The founders had already promised the users that they would be compensated for their assets on the platform.
The DOCA plan would help to guarantee the safety of Digital Surge’s customers, as well as help to restore the trust of the investors in the crypto industry. The founders of the exchange hoped that the plan would be approved and that the funds of the customers would be recovered. They also hoped that this would help to revive the crypto industry, which had been affected by the FTX collapse.
At the moment, Digital Surge is waiting for the creditors’ approval of the DOCA plan. If the plan is approved, the funds of the customers will be recovered and the crypto industry will be able to rebuild itself. Until then, the firm will continue to work on all possible options to help ensure the safety of their customers and the stability of the crypto industry.