- Most former FTX creditors will get back more than they originally lost.
- A reorganization plan promises cash payments within two months after approval.
- Total assets available for distribution range between $14.5 billion and $16.3 billion.
- The value of bitcoin has significantly increased since the collapse of FTX.
- Sam Bankman-Fried, founder of FTX, is serving a 25-year prison sentence.
FTX administrators have announced that nearly all out-of-pocket creditors will be fully reimbursed following the cryptocurrency exchange’s downfall in late 2022. This comes as part of a new reorganization plan which aims to settle debts incurred during its collapse.
Detailed Repayment Plan
According to the filed reorganization plan, about 98% of the creditors are set to receive 118% of their approved claims in cash.
This payment is expected to be made within 60 days following the approval of the plan. The rest will receive full compensation for their claims along with additional funds as compensation.
The total assets earmarked for these payments are estimated to be worth between $14.5 billion and $16.3 billion. Additionally, there may also be up to 9% in backdated interest added from when FTX initially went under.
Asset Recovery and Acknowledgments
The successful recovery was attributed by John J. Ray III, chief restructuring officer at FTX, to “monetizing an extraordinarily diverse collection of assets.”
These included investments primarily held by Alameda or FTX Ventures businesses as well as through litigation claims.
Ray extended his gratitude towards various governmental agencies such as the United States Department of Justice, Commodity Futures Trading Commission (CFTC), Internal Revenue Service (IRS), and Securities Commission of The Bahamas for their support throughout this complex process.
He concluded by thanking all customers and creditors for their patience while awaiting resolution after what was undoubtedly a turbulent period for them financially due to the platform’s unexpected demise.
This announcement marks a significant step towards resolving one of the most notable collapses in cryptocurrency history while providing much-needed closure for many affected parties involved with FTX.
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