Digital Surge Survives Contagion After FTX Collapse, Secures Funds with $1M Contribution
• FTX, a crypto exchange, collapsed last year, causing a contagion among several companies exposed to it.
• Digital Surge, an Australian crypto exchange, was one of the firms that lost access to their funds on the FTX exchange.
• Digital Surge proposed a Deed of Company Agreement (DOCA) to its customers and the founders of the firm agreed to contribute $1 million from another private source to the firm.
Crypto exchanges have become increasingly popular in recent years, with many investors and firms using the platforms to trade digital currencies. However, the industry was shaken last year when one of the top crypto exchanges, FTX, filed for bankruptcy. This caused a contagion among several companies exposed to the distressed exchange.
One of the firms affected by the FTX collapse was Digital Surge, an Australian crypto exchange with about $23.4 million in digital assets on the platform. To protect customers and their funds, Digital Surge suspended withdrawals on its platform. The firm was determined to find a way to recover the locked funds and proposed a Deed of Company Agreement (DOCA).
The DOCA required the creditors’ approval and the founders of Digital Surge, Daniel Rutter and Josh Lehman, agreed to contribute $1 million from another private source to the firm. They had already promised the users that the firm would compensate them for their assets on the platform. To ensure the success of the DOCA and the recovery of the funds, Digital Surge contacted their customers through email regarding the rescue plan.
Despite the collapse of FTX, Digital Surge has managed to survive the spreading contagion and is now working to recover its locked funds. The firm has taken measures to ensure the safety of its customers and their assets, and is committed to finding a solution for their fund recovery. With the help of the DOCA and the contribution from the founders, Digital Surge is confident that it can repay all its customers.