The bankrupt cryptocurrency exchange FTX announced today that the restructuring plan approved by the court will take effect in January 2025. Next month, FTX's creditors will finalize agreements with distributors to compensate former users, especially those overseas.
The restructuring plan has caused dissatisfaction among creditors, but FTX is making maximum efforts to recover the lost assets.
Restructuring at FTX
In a recent press release, FTX stated that they are almost ready to implement the court-approved restructuring plan. Under this plan, FTX's creditors are expected to finalize agreements with fund distributors in December and begin reimbursing claimants in January 2025.
"We are pleased to announce that we will begin distributing recovered funds in early 2025. While continuing to take steps to optimize recoveries, we are working at full force to reach these agreements... and quickly pay creditors and customers," said John J. Ray III, CEO and Restructuring Director of the FTX Debtors.
Things seem to be wrapping up in the FTX saga, now that its notorious founder, Sam Bankman-Fried, is behind bars. Bankman-Fried is currently appealing his criminal sentence, but many forces have turned against him. Notably, FTX co-founder Gary Wang is not serving a prison sentence due to sufficient testimony against this former CEO.
Additionally, while the U.S. Attorney's Office in SDNY expects a reduction in cryptocurrency prosecutions under the Trump administration, Bankman-Fried is an exception. Prosecutors are eager to finalize a definitive ruling on this high-profile case, despite changes in leadership.
His criminal conduct at FTX is a national focus, and the authorities want to make a name for themselves.
However, this process still creates disappointment. FTX creditors report that they will recover between 10% and 25% of the defrauded assets, which has caused significant dissatisfaction. The exchange, for its part, has made its utmost efforts to achieve the maximum possible.
FTX has settled a lawsuit with Bybit to reduce operating costs and has filed new lawsuits to recover other losses. Its FTT token has also increased in value, potentially creating liquidation.
Ultimately, this announcement does not change the basic restructuring plan of FTX. The defunct exchange will continue its efforts to recover assets and soon begin distributing them to former users.
