FTX expects the reorganization plan to take effect in January 2025.

The cryptocurrency exchange FTX has filed for bankruptcy today and announced that the court-approved restructuring plan will take effect in January 2025. Next month, FTX's creditors will finalize agreements with distributors to refund former users, especially those overseas.

The restructuring plan has caused dissatisfaction among some creditors, but FTX is making maximum efforts to maximize asset recovery.

Also Read: FTX Co-Founder Gary Wang Avoids Jail Time by Testifying Against SBF

Restructuring at FTX

In a recent press release, FTX announced that they are nearly ready to implement the court-approved restructuring plan. Under this plan, FTX's creditors are expected to finalize distribution agreements in December and begin refunding claimants in January 2025.

"We are pleased to announce that we will begin distributing proceeds in early 2025. While we continue to take actions to maximize recoveries, we are moving expeditiously to reach these agreements... and return value to creditors and customers as quickly as possible,"

said John J. Ray III, CEO and Restructuring Officer of the FTX debtors.

Things appear to be winding down in the FTX saga, with the infamous founder Sam Bankman-Fried behind bars. Bankman-Fried is currently appealing his criminal sentence, but there are many forces working against him. For example, FTX co-founder Gary Wang avoided jail time due to his extensive cooperation in testifying against the former CEO.

Additionally, while the U.S. Attorney's Office for the SDNY was expected to scale back cryptocurrency crackdowns under the Trump administration, there is an exception for Bankman-Fried. Prosecutors want to secure a definitive conviction in this high-profile case, despite the change in leadership. His misconduct at FTX has become a national headline, and law enforcement wants to have its say.

However, the process is still disappointing. FTX creditors are expected to recover between 10-25% of the defrauded funds, which has caused dissatisfaction. For its part, the exchange has made efforts to provide as much as possible.

FTX has settled a lawsuit with Bybit to reduce costs and has filed new lawsuits to recover other losses. Their FTT token has also increased in value, potentially providing liquidity. Ultimately, this announcement does not change the basic restructuring plan at FTX. The exchange has ceased operations and will continue efforts to recover assets, which will soon begin to be distributed to former users.

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