After FTX receives court approval to pay its customers in full, FTT will skip 50%
Key receivers
FTX's Chapter 11 reorganization plan was approved by the US Bankruptcy Court on Monday. FTX lenders receive 119% of approved claims in cash after court approval.
Share this article
FTX's native token, FTT, rose more than 50 percent to $3.23 on Monday after FTX received court approval for its bankruptcy plan. The plan allows FTX to pay customers in full using $16 billion in recovered assets, including interest.
After the operation, FTT now sits at around $2.72, CoinGecko data shows. The token's price has risen 100% in the past two weeks as investors await the confirmation hearing.
On Monday, Judge John Dorsey of the US Bankruptcy Court for the District of Delaware upheld FTX's Chapter 11 reorganization plan. Nearly two years after its collapse, FTX's bankruptcy saga is nearing its conclusion.
Judge Dorsey also asserted that FTX's native token, FTT, has zero value, reinforcing the exchange's current lack of momentum.
“I have no evidence today that the value of FTT tokens will be anything other than zero,” Judge Dorsey said.
Under the restructuring plan, 98% of creditors receive 119% of approved claims within 60 days of the plan's implementation. The decision follows a favorable vote of 94% of creditors, representing approximately $6.83 billion in claims.
Total proceeds are estimated to be between $14.7 billion and $16.5 billion. The amount includes divestment of assets from FTX itself, international subsidiaries, government agencies and affiliates.
“Today's success is only possible because of the experience and tireless efforts of the team of professionals behind this cause, building FTX's books from the ground up and leveraging assets from around the world to raise billions,” said John Jay. Ray III, CEO and Chief Restructuring Officer of FTX. “It also reflects our strong collaboration with governments and agencies around the world who share FTX's goal of reducing domestic abuse.”
The exact date of implementation of the plan has not been announced. Ray III funds are distributed to more than 200 creditors and is working with special agents to ensure safe and efficient delivery of assets.
Despite some objections to payment methods, the scheme will continue with cash distribution, as confirmed in Monday's court session. With today's court approval, FTX customers are expected to be reimbursed for their losses in the coming months.
FTX, a once-respected crypto empire, collapsed in November 2022 after it was revealed that the company was using client funds to make risky investments.
Sam Bankman-Fried, the former CEO of FTX, was convicted and sentenced to 25 years in prison on multiple charges of fraud and embezzlement. Last month, he filed an appeal against his conviction for fraud and conspiracy.
Bankuman-Fried's circle of criminal associates, including Alameda Research CEO Caroline Ellison, face legal consequences for their role in the FTX fraud. Ellison was sentenced to two years in prison last month. In addition to her prison term, she is also expected to forfeit $11 billion for her involvement in the exchange failure.
Share this article
