Key Takeaways:
- FTX’s bankruptcy plan has been approved, allowing most customers to recover around 118% of their lost funds from 2022, primarily in cash.
- Judge Dorsey dismissed objections for in-kind crypto repayments, with FTT tokens valued at zero despite a post-ruling price spike.
- Liquidation of assets, including an $884M stake in AI startup Anthropic, enabled FTX to strengthen its financial position and repay creditors.
A Delaware judge has approved FTX’s bankruptcy plan, allowing most customers to recover more than what they lost when the crypto exchange collapsed in 2022.
Creditors overwhelmingly supported the plan, with about 96% voting in favor.
The FTX Debtors today announced that the United States Bankruptcy Court for the District of Delaware has confirmed FTX’s Plan of Reorganization. Read about it here: https://t.co/kETV0rgs0v
— FTX (@FTX_Official) October 7, 2024
Customers can expect to receive around 118% of their holdings’ value at the time of FTX’s bankruptcy, with some potentially getting up to 140%.
Despite objections from companies and individual creditors pushing for in-kind crypto repayments, the court ruled in favor of cash payouts.
FTT tokens were valued at zero, despite their price spiking 55% after the court decision.
FTX’s ability to repay creditors stems from liquidating investments, including an $884 million stake in AI startup Anthropic.
The estate lacks enough crypto to return holdings directly, making in-kind repayments impossible.
However, discussions are ongoing about stablecoin payments, though the U.S. Securities and Exchange Commission has raised concerns.
About The Author
Adam Morris, the co-founder of Crypto Head and a respected crypto expert, offers insightful commentary and analysis on cryptocurrency, NFTs, and the evolving digital landscape.
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