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FTX outlines plan to repay creditors in full with interest – Crypto News
FTX Trading Ltd. proposed a reorganization plan to the U.S. Bankruptcy Court in Delaware on Tuesday, aiming to fully repay its non-governmental creditors, including interest.
The plan, pending court approval, is designed to address over US$14 billion in debts and offers up to 118% of claim value to the majority of creditors through asset liquidations and settlements.
The reorganization strategy includes a fund pool estimated between US$14.5 and US$16.3 billion, derived from asset sales and settlements. This estimate includes assets under the control of the Chapter 11 debtors and the official joint liquidators, FTX said in a press release on Tuesday.
A special provision for smaller creditors with claims up to $50,000 could result in 98% of them receiving approximately 118% of their claim value within 60 days of the plan’s activation if approved by the Bankruptcy Court.
The reorganization plan is a response to the company’s dramatic collapse in 2022, which led to the conviction and sentencing of former chief executive officer Sam Bankman-Fried for fraud.
In March this year, Bankman-Fried was sentenced to 25 years in prison.
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