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has filed a plan in bankruptcy court to repay creditors who held cryptocurrencies on the troubled exchange. While the vast majority of customers intend to get their money back with interest, they (and their debtors) have missed out on significant gains in the crypto market since FTX’s dramatic collapse in November 2022. The price of Bitcoin has more than tripled.
FTX aims to fully repay its non-governmental creditors based on the amount owed as determined by the bankruptcy court. That means 98% of creditors (those with claims up to $50,000) will receive 118% of their granted claims. Other creditors will return the money and Billions of dollars in compensation “for the time value of investments.”
Government creditors are seeking repayment at a 9% interest rate. Among the stakeholders with whom FTX has agreed to a settlement are the Internal Revenue Service and the Department of Justice.
The company has indicated that if the restructuring plan is approved, it would be able to resolve disputes with private and government stakeholders “without costly and lengthy litigation.” Overall, FTX says he will be able to distribute $16.3 billion in cash, up from $14.5 billion.
But you may be wondering, where exactly is this money coming from? After all, FTX only held 0.1% of Bitcoin and 1.2% of Ethereum that it thought its customers owned 17 months ago.
FTX said it was “able to monetize a highly diverse collection of assets, most of which were proprietary investments held by the Alameda All FTX Ventures business, or litigation claims.”as tech crunch The assets tracked by FTX CEO John J. Ray III and his team reportedly included about $8 billion in real estate, political contributions, and venture capital investments.
The company filed its latest reorganization plan just weeks after co-founder and former CEO Sam Bankman Fried (aka SBF) passed away. He was indicted in November on charges including wire fraud and money laundering conspiracy.