When Payment in Full Isn't What You Hoped For ...

In the abstract, unsecured creditors receiving 100% of what their claim is (plus interest!) is the best possible outcome in a bankruptcy proceeding.  However, as the crypto company bankruptcies continue to play out, customers who thought they owned specific tokens have learned a hard lesson on the difference in bankruptcy between a secured claim and unsecured claim.

In general, secured creditors (among other protections) are entitled to get their collateral back. Had the customers of FTX been secured by the assets in their accounts, then they would be entitled to benefit from the bull run crypto is on since FTX filed for bankruptcy in late 2022. However, the customers have learned the hard way that they did not have rights to specific segregated cryptocurrencies and rather just had a general unsecured claim against the entity that was holding their cryptocurrencies.  Since bankruptcy claims are valued on the day the company files, the customers' claims did not include the appreciation in crypto value, and as general unsecured creditors, they were only entitled to payment equaling the value of their crypto holdings on the day the company filed for bankruptcy.   

Of course, absent the run in crypto, it is likely that the FTX customers would be getting a much smaller distribution, so customers can take some solace in the fact that they will be getting a significant distribution even if it wasn't the crypto riches that they had hoped for.