The bankrupt FTX estate has unveiled a new reorganization plan that promises substantial returns to its creditors.FTX creditors with claims below $50,000 would be eligible for a 118% recovery within 60 days of its approval by the Delaware bankruptcy court. Other non-governmental creditors would receive 100% of their claims plus up to 9% interest to account for the time value of their investments.Meanwhile, provisions exist to settle claims with regulatory bodies such as the IRS and CFTC. The IRS is poised to receive approximately $200 million, while the CFTC’s settlement remains undisclosed.FTX anticipates that the total value of assets collected and converted to cash for distribution will range between $14.5 and $16.3 billion. The firm achieved this recovery level by monetizing various assets, predominantly proprietary investments from Alameda or FTX Ventures businesses and litigation claims.John J. Ray III, Chief Executive Officer and Chief Restructuring Officer of FTX, said:“We are pleased to be in a position to propose a chapter 11 plan that contemplates the return of 100% of bankruptcy claim amounts plus interest for non-governmental creditors.”FTX creditors are expressing discontent with the proposed reorganization plan, highlighting their inability to recover stolen funds at current market rates.Sunil Kavuri, a notable creditor, raised concerns about Sullivan & Cromwell’s inclusion of an Exculpation clause, shielding them from misconduct allegations such as selling FTX assets at substantial discounts.Similarly, Mike Belshe, the CEO of BitGo, added:“0% of FTX creditors agree that receiving $16800 for your Bitcoin is fully compensated. I understand why the bankruptcy process needs to work this way but let’s not pretend victims are getting their money back or that FTX wasn’t as awful as it was.”However, Bloomberg ETF analyst James Seyffart supported the plan, lauding its moral trajectory despite acknowledging that the figures may not fully restore creditors’ losses. He said:“Good good GOOD! The numbers won’t equate to FTX creditors just holding onto their assets. But allowing people to get more than 100% of their claim value from the time of bankruptcy is a move in the *Morally Correct* direction.”Oluwapelumi values Bitcoin’s potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.Armed with a classical education and an eye for news, Andjela dove head deep into the crypto industry in 2018 after spending years covering politics. Join our X community for real-time crypto news and expert insights.CryptoSlate’s latest market report dives deep into the effects corporate Bitcoin purchases have on the market.Disclaimer: Our writers’ opinions are solely their own and do not reflect the opinion of CryptoSlate. None of the information you read on CryptoSlate should be taken as investment advice, nor does CryptoSlate endorse any project that may be mentioned or linked to in this article. Buying and trading cryptocurrencies should be considered a high-risk activity. Please do your own due diligence before taking any action related to content within this article. Finally, CryptoSlate takes no responsibility should you lose money trading cryptocurrencies.
