- FTX’s restructuring plan offers creditors 118% of what they’re owed, exceeding expectations.
- Current market values far surpass assets’ worth in November 2022, leaving creditors missing out on gains.
- FTX’s liquidation process, overseen by Galaxy Digital, faced delays before the amended plan.
After selling off the bulk of the bankrupt company’s assets, FTX administrators are altering the reorganization plan. Unexpectedly, they are putting up a settlement that would see 98% of creditors get 118% of what they are owed, a sum that surpasses projections.
Although the course of this proposal is initially generous, it is lower than what the market value of the assets that were kept on the platform in November 2022. Unlike in 2022, there is an extremely large difference in the margins where the price of bitcoin increased significantly from $17000 to $62000 and Ethereum rose from $1300 to $3000.
Many debtors are therefore finding it difficult to accept that they are not benefiting from the bull market. The bankruptcy processes for FTX state that creditors will receive payment in fiat money equal to the worth of their assets as of November 2022. Assets that were valued far less back then are therefore now worth a great deal more.
For example, $1,000 invested in Bitcoin at the time would be worth over $3,760 now, but $2,310 would be the same amount invested in Ethereum. The value difference between the assets back then and now draws attention to the chances that FTX clients lost.
The business agreed to sell its assets and named Galaxy Digital to manage the transactions, which led to the revised restructuring plan. However the procedure was plagued by delays; the first round of liquidations was delayed until October.
Some contend, notwithstanding the criticism, that given FTX’s collapse, it would have been impossible to distribute assets in accordance with the gains of the crypto market. Although angry creditors have referenced Mt. Gox’s method of paying out in Bitcoin and Bitcoin Cash, it’s important to remember that FTX provided a wider selection of cryptocurrencies.
Ultimately, even if FTX’s plan would not completely appease creditors, it is a start in the right direction toward ending the bankruptcy drama. Creditors are watching how FTX’s reorganization efforts turn out as the cryptocurrency market keeps changing.
Read CRYPTONEWSLAND on
google news
Read Also
disclaimer read moreCrypto News Land, also abbreviated as "CNL", is an independent media entity - we are not affiliated with any company in the blockchain and cryptocurrency industry. We aim to provide fresh and relevant content that will help build up the crypto space since we believe in its potential to impact the world for the better. All of our news sources are credible and accurate as we know it, although we do not make any warranty as to the validity of their statements as well as their motive behind it. While we make sure to double-check the veracity of information from our sources, we do not make any assurances as to the timeliness and completeness of any information in our website as provided by our sources. Moreover, we disclaim any information on our website as investment or financial advice. We encourage all visitors to do your own research and consult with an expert in the relevant subject before making any investment or trading decision.
