FTX investors can begin to see the light at the end of the tunnel. FTX directors have announced a plan to return more than 90% of FTX and FTX.US customer assets by 2024.
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90% of FTX customer funds could be returned
Following discussions with the Unsecured Creditors’ Committee, made up of international customers and parties involved in class actions relating to customer assets, the directors of FTX have reached a major milestone in their Chapter 11 proceedings.
On October 16, they filed a proposal for settlement before a Delaware bankruptcy court, with the aim of return customers’ assets as soon as next year.
The settlement plan provides for the creation of a claim to make up the shortfall, enabling customers to recover up to 90% of available assets. These funds will be divided into two categories: one for FTX.com and the other to FTX.US.
More specifically, the claim to make up the deficit is estimated at 8.9 billion for FTX.com and to 166 million for FTX.US. A formal proposal must be submitted to the court by December 16 to finalize the settlement.
If approved by the bankruptcy court, the funds could be redistributed to customers as early as the second quarter of 2024.
FTX settlement plan includes reduced claims for some investors
The settlement plan clearly sets out specific terms for customers who have made withdrawals of more than $250,000 from the platform during the first nine days of the bankruptcy proceedings. In this context, their claims could be reduced by 15% of the initial amount.
It’s worth noting that claims under $250,000 will remain intact, offering some comfort to smaller investors.
In addition, the revised plan stipulates that FTX has the power to exclude from the agreement any entity, affiliate, or customer suspected of having knowledge of fraudulent schemes; or irregular transactions in relation to customer deposits or company funds.
The purpose of this clause is twofold: to guarantee the probity of the agreement, and to exclude any entity informed of wrongdoing related to this case. At the same time, the trial of CEO Sam Bankman remains in the spotlight, and everyone is eagerly awaiting the outcome of this saga.
As a journalist at Coinpri, I’ve been captivated by the world of bitcoin and blockchain since 2020. The decentralized aspect of Bitcoin particularly piqued my interest. Since then, I’ve been working constantly to spread my knowledge, hoping one day to see a world where everyone fully enjoys their financial freedom.