Bankrupt cryptocurrency exchange FTX today announced that its court-approved restructuring plan will take effect in January 2025. Next month, FTX debtors will finalize agreements with distributed to reimburse former users, especially those located abroad.
The restructuring plan has caused dissatisfaction among creditors, but FTX is making every effort to restore lost assets.
Restructuring at FTX
In one press release Recently, FTX announced that they are almost ready to implement a restructuring plan as approved by the court. Under this plan, FTX debtors are expected to finalize agreements with fund distributors in December and begin repaying applicants in January 2025.
“We are pleased to announce that we will begin distributing recovery proceeds in early 2025. As we continue to make moves to optimize recovery, we are moving full steam ahead to achieve [các] this agreement… and promptly pay creditors and customers,” said Mr. John J. Ray III, CEO and Chief Restructuring Officer of FTX Debtors.
Things seem to be winding down in the FTX saga, now that its infamous founder, Sam Bankman-Fried, is behind bars. Bankman-Fried is currently appealing his criminal conviction, but many forces have gathered against him. Notably, FTX co-founder Gary Wang did not have to serve a prison sentence due to the full testimony against this former CEO.
Additionally, although the U.S. Attorney’s office at SDNY expected a reduction in cryptocurrency crackdowns under the Trump administration, Bankman-Fried was an exception. Prosecutors look forward to completing a definitive verdict in this high-profile case, despite the change in leadership.
His criminal conduct at FTX was a national highlight, and law enforcement wanted its own notoriety.
However, this process still creates frustration. FTX creditors reported that they would recover between 10% and 25% of the defrauded assets, which caused great discontent. The exchange, for its part, has made every effort to achieve the maximum possible.
FTX settled a lawsuit with ByBit to reduce operating costs and has opened new lawsuits to recover other losses. Its FTT token has also increased in value, potentially generating liquidity.
Ultimately, this announcement does not change FTX’s fundamental restructuring plan. The disbanded exchange will continue its efforts to recover assets, and will soon begin transferring them to former users.