FTX Bankruptcy Update: Creditors Seek In-Kind Crypto Payments Amid Restructuring Plan
The post FTX Bankruptcy Update: Creditors Seek In-Kind Crypto Payments Amid Restructuring Plan appeared on BitcoinEthereumNews.com.
The collapse of the FTX exchange in November 2022 left many users without access to their funds, causing widespread concern in the crypto community. Subsequent to the abrupt halt in withdrawals, FTX was hacked, leading to further complications for its users and stakeholders. FTX’s founder, Sam Bankman-Fried, faced legal consequences, culminating in a lengthy prison sentence of over 20 years, but creditors are still awaiting reimbursement. FTX exchange’s bankruptcy continues to leave creditors in limbo as recent developments unfold, highlighting the complexities of reclaiming lost cryptocurrencies. New Chapter for FTX Creditors On June 25, a crucial hearing addressed the grievances of FTX creditors, with the exchange’s bankruptcy proceedings still underway. Despite declaring bankruptcy in November 2022, the process of refunding defrauded clients hasn’t commenced. The bankruptcy hearing, presided over by Judge John Dorsey of the US Delaware Bankruptcy Court, focused on the exchange’s proposed restructuring plan, which requires the judge’s approval before creditors can cast their votes. FTX’s restructuring blueprint, unveiled in May, intends to distribute 118% of claims to 98% of its creditors, with a provision for claims under $50,000 to receive a compensated refund. This plan hinges on the consent of the creditors, anticipated to be gauged through a voting process. Disagreements Among Stakeholders Several creditor representatives have expressed a preference for receiving repayments in cryptocurrency rather than in US dollars converted from the bankrupt exchange’s token prices. Given the considerable appreciation of cryptocurrencies since November 2022, this option could be more advantageous for creditors. Andrew Dietderich, an attorney for FTX, affirmed that the restructuring plan was designed with broad consensus and intended to collect feedback from creditors through the upcoming voting. TRUSTED BY COINOTAG,Did you missed $MEME, $PEPE or Bitcoin? No worries! Click here to sign up chosen altcoin exchange! David Adler, representing the creditors, criticized the…
Filed under: News - @ June 26, 2024 2:22 am