FTX announced that bankruptcy proceedings under Chapter 11 of the U.S. Bankruptcy Code will be initiated in a voluntary and orderly manner.

Let me briefly explain it to you:

Under Chapter 11 of the U.S. Bankruptcy Code, a company can negotiate with its creditors and wait until a reorganization plan is available before making repayments. Prior to this, the company no longer needs to repay debt, which is equivalent to gaining an opportunity for buffer extension.

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