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To avoid bankruptcy, FTX files a reorganization plan


Blockchain

To avoid bankruptcy, FTX files a reorganization plan

Launching a final round of possible legal squabbles over how to best conclude the bankruptcy case of the fraud-tainted cryptocurrency firm, FTX Trading Ltd. published its latest proposal for returning billions of dollars to consumers and creditors.

Whether FTX will resurrect its shuttered cryptocurrency exchange, how the business will value certain digital tokens, and the amount of return creditors can anticipate are among the key questions that the reorganization plan failed to address.

The plan will be submitted to creditors for a vote the following year, probably with some important elements added, before it is ultimately approved by US Bankruptcy Judge John Dorsey. The plan's general parameters have been approved by the principal creditor and customer groups participating in the Chapter 11 lawsuit.

Once the majority of the company's cryptocurrency holdings have been liquidated, the payout plan calls for the distribution of billions of dollars in cash.

The founder of FTX, Sam Bankman-Fried, was found guilty last month of masterminding a significant fraud that caused his exchange to crash.

Following Bankman-Fried's agreement to hand over management of his empire to restructuring experts, the company filed for bankruptcy last year. Since then, the advisors have been looking for assets and working to sort through a complicated web of debt that is due to several creditors, including users of the trading site who have added cryptocurrency and cash.

The case is U.S. Bankruptcy Court for the District of Delaware v. FTX Trading Ltd., 22-11068.


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