Creditors Submit Revised Plan in Complex FTX Cryptocurrency Exchange Bankruptcy Case
Summary:
Creditors of the defunct cryptocurrency exchange FTX have submitted a revised Chapter 11 reorganization plan, which proposes to retrospectively determine customer asset claims based on the value at the time of FTX's collapse in November 2022. The intricate bankruptcy case, involving FTX and 130 associated entities, continues to unfold with balancing stakeholder interests being a key focus.
Creditors of the shuttered cryptocurrency exchange FTX have submitted a revised Chapter 11 reorganization plan. The plan suggests that customer asset claims will be determined retrospectively based on the value at the time of FTX's collapse in November 2022. The latest legal document filed in the U.S. Bankruptcy Court for the District of Delaware by the creditors explains that a "customer entitlement claim" is any claim, irrespective of its kind or nature, lodged against the exchange intended to compensate the claimant based on the value at the date of the petition.
The creditors of FTX have submitted the reorganization plan, disregarding FTX's Terms of Service which states digital assets belong to the users, not FTX Trading. The proposal indicates that digital assets will be valued at the conversion rates present at the petition date.
On November 11, 2022, FTX and 130 associated companies filed for bankruptcy, when the price of Bitcoin was $17,036. At the time of this report, the Bitcoin price has risen to $42,272.
Joseph Moldovan, the head of business solutions, restructuring, and governance practices at Morrison Cohen, a law firm in New York, shared with Cointelegraph that the FTX bankruptcy is particularly intricate. He highlighted how unusual the FTX bankruptcy was due to the debtors being complicated bodies with large debt amounts.
As reported by Cointelegraph on December 7, the FTX 2.0 Customer Ad Hoc Committee suggested modifying the reorganization plan, aiming to maintain a balance of interests among stakeholders. More details will be provided as this ongoing story unfolds.
Published At
12/17/2023 2:30:57 AM
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