Recently, U.S. Bankruptcy Judge Jon Dorsey officially approved FTX's bankruptcy reorganization plan, clearing the way for the bankrupt cryptocurrency trading platform to pay billions of dollars to its creditors. This move marks a key step for FTX in reducing its operations and compensating damaged users.
According to the approved plan, 98% of FTX creditors are expected to receive approximately 119% of their claims within 60 days of the plan taking effect. FTX expects the total distributable assets to reach US$14.7 billion to US$16.5 billion, covering assets recovered from all over the world.
John J.Ray III, CEO and chief restructuring officer of FTX, said: "We are planning to return the full amount of bankruptcy claims and corresponding interest to non-government creditors through the largest and most complex bankruptcy asset distribution process in history." He further revealed that the company is negotiating with specialized institutions to ensure that funds can be recovered safely and quickly from customers around the world.
FTX announced that the Delaware Bankruptcy Court has officially confirmed its reorganization plan. The news comes less than two years after FTX suddenly collapsed in November 2022, which caused a huge shock in the cryptocurrency industry at the time. Since then, a professional team has been working to rebuild FTX's financial records and carry out asset recovery efforts around the world.
Dorsey, the bankruptcy judge who heard the case, praised FTX's restructuring work and considered it a model for handling complex Chapter 11 bankruptcy procedures. However, despite the plan's promise of full repayment, some customers may still regret missing out on a sharp rebound in cryptocurrency prices. Since FTX filed for bankruptcy, the price of Bitcoin has soared by about 260%.
The FTX bankruptcy case has been the focus of the cryptocurrency industry and financial regulators. Previously, FTX founder Sam Bankman Fried was sentenced to 25 years in prison for fraud, but he has formally appealed and sought a retrial. At the same time, the U.S. Commodity Futures Trading Commission (CFTC) reached a $12.7 billion settlement with FTX to resolve the 19-month-long lawsuit. The U.S. Securities and Exchange Commission (SEC) expressed concern about FTX's payment plan to creditors, especially the use of stablecoins.
As the FTX bankruptcy case progressed, bitcoin prices fell on Monday, but remained above $60,000. On Tuesday, bitcoin was trading at $62,430.
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