FTX’s Restructuring Proposal: Absurd Compensation Based on Last Year’s Bankruptcy Prices!
Controversial Restructuring Plan by FTX
FTX, the cryptocurrency exchange that declared bankruptcy, has recently submitted a revised Chapter 11 restructuring plan.pdf to the Delaware Bankruptcy Court on December 16th. The plan proposes compensating customer asset claims based on the cash value at the time of FTX’s bankruptcy filing in November 2022. This decision could result in creditors losing millions in potential gains.
Further reading：The Verdict Is In: SBF Convicted on All Charges in Historic Crypto Fraud Case
Bitcoin’s Price Surge Since FTX’s Bankruptcy
Since FTX’s bankruptcy, the cryptocurrency market has seen a significant rise. Bitcoin, which was around $17,000 during the bankruptcy filing, has recently climbed to about $42,000. Ethereum has also jumped from around $1,000 to $2,200. Moreover, the overall cryptocurrency market cap has increased from approximately $856 billion to the current $1.6 trillion. If approved, this plan could lead to substantial losses for all creditors.
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Community Outcry: Cryptocurrency Belongs to Customers!
Sunil, a Key Opinion Leader (KOL) closely following the FTX restructuring, expressed outrage at the plan, arguing it violates FTX’s service terms. These terms explicitly state that digital asset ownership belongs to customers, not the exchange.
Future Voting on the New Proposal
Certain creditors will have the opportunity to vote on this new proposal. The FTX restructuring team stated in a release that they have exerted considerable effort to achieve this plan. Their goal is to ensure the plan is fair and reasonable for all creditors and stakeholders impacted by this Chapter 11 bankruptcy case and economically the most advantageous solution.
Further reading：IRS Chases FTX for a Staggering $24 Billion in Unpaid Taxes: Legal Team Slams Claim as Absurd, Warns of Delayed Repayment to Users
For the plan to be effective, it requires the consent of a certain number and amount of creditors. However, there’s a concept known as “cram-down,” where even if some creditors disagree with the plan, they might have to accept it if deemed fair and reasonable.
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Keywords: FTX, Restructuring Plan, Bankruptcy, Cryptocurrency, Bitcoin, Ethereum, Market Value, Creditors, Compensation, Delaware Bankruptcy Court, Chapter 11, Digital Assets, Ownership, Sunil, Key Opinion Leader, Service Terms, Vote, Cram-Down
