FTX's bankruptcy plan approved: At least $12.6 billion to be distributed
The bankruptcy plan of the cryptocurrency exchange FTX, which collapsed in November 2022, was approved by the court. The way for refunds to be made to customers will thus be distributed at least $12.6 billion while opening.
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The bankruptcy plan of cryptocurrency exchange FTX has been approved by the court nearly two years after the collapse of the exchange. With this approval, refunds to be made to customers have been opened.
Within the scope of the plan, 98 percent of the creditors will receive 118 percent of the amount they request in cash.
The largest group of creditors in FTX is not satisfied with this situation. Lawyer Sunil Kavuri, the representative of the group, argued that the amounts should be paid in kind (over cryptocurrencies themselves) instead of the dollar value of cryptocurrencies at that time. Lawyer David Adler, representing another group of creditors, said that creditors would pay a significant amount of tax if payments were made in cash.
These objections remained inconclusive. The FTX representative stated that the exchange does not have the cryptocurrency needed to make distribution in kind. Judge John Dorsey opposed the distribution in kind, and the plan was approved with reimbursements in cash.
Bitcoin has almost quadrupled since the late 2022 bankruptcy. This means that customers who held BTC on the stock market at that time would receive a large amount of less refunds.
At least 12.6 billion dollars will be distributed
Within the scope of the approved plan, FTX will distribute at least 12 billion 600 million dollars to its customers in total. It is stated that this amount may increase up to $16.5 billion after FTX completes the sale of all assets. On the other hand, payments will not start immediately. Previously, FTX needs to make an agreement with a company to audit the distribution process.
