FTX 2.0 Plans Complete Cash Payment to Creditors, Wipeout FTT Token
In the latest development, the FTX 2.0 Group has unveiled a draft-creditor repayment plan as part of its bankruptcy restructuring process. The newly revamped exchange is planning for settling customer claims in cash while wiping out its native cryptocurrency FTT token.
FTX 2.0 is planning to amend this plan based on feedback from stakeholders. Thus, it proposes valuing customer claims in USD as of the date of bankruptcy. As per the court papers, the restructuring plan involves FTX 2.0 repaying the creditors by attaching assets tied to different verticals of the business. Furthermore, the filing shows that FTX 2.0 still hasn’t ruled out the rebooting of its offshore exchanges.
Three recovery pools will be used to guide creditor repayments. These pools include assets from FTX.com customers, FTX US customers, and assets not directly connected to the exchanges. The company considers most proposed creditor classes impaired, indicating that it does not expect to fully compensate them.
FTX 2.0 Suggests No Recovery of FTT Tokens
The restructuring plan for FTX 2.0 calls for no recovery of the FTT tokens citing their “equity-like characteristics”. The US bankruptcy reorganization plan usually wipes out the equity component. Commenting on the development, FTX Chief Restructuring Officer John J. Ray III said:
“We are pleased today to deliver on our commitment to file the Plan at this relatively early stage. The company intends to collaborate with creditors in the coming months and file an amended plan in the fourth quarter of this year”.
FTX has mentioned that the plan is still in the early stages and further modification is possible. The proposal also suggests that 7 groups of creditors will have a chance to vote on the plan, including FTX.com customers, FTX US customers, and non-fungible token holders.
Last month in July, FTX 2.0 sued disgraced founder Sam Bankman-Fried and his team to recoup a large part of their questionable transactions. The exchange alleged that the defendants consistently misused funds for luxury condos, political contributions, speculative investments, and personal projects, leading to what the company referred to as “one of the largest financial frauds in history.”
- Expert Explains Pi Network–Sign Meeting, Says It Could Trigger Binance Listing
- Is Trump Family, Mr. Beast Buying ASTER Token? Rumors Gain Strength
- Solana ETF Update: Grayscale, Fidelity, Others Files S-1 With Staking, Approval Expected in Two Weeks
- Cyber Hornet Seeks SEC Nod for S&P 500 and XRP ETF
- Cathie Wood’s Ark Invest Eyes Stake in Tether as USDT Issuer Targets $500B Valuation
- Solana Price Set for Q4 Surge as Canary Capital ETF Filing Meets Wyckoff Accumulation
- Avalanche Price Could Surge to $50 as Transactions Jump 200%
- CHMPZ Price Prediction:Will This Net-Zero Community Token be the Next Gem?
- Ethereum (ETH) Price Set for a rebound as Whales Accumulate $1.6B ETH and Outflows Hit $622M
- HYPE Price Prediction As Bitwise Files For Hyperliquid ETF – Is $55 In Sight?
- Shiba Inu Price Eyes Recovery From Demand Zone With Burn Rate Soaring Nearly 400%
Why Trust CoinGape
CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights Read more…to our readers. Our journal analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.
