In a revised Chapter 11 plan of reorganization, FTX debtors state that crypto claims by customers will be assessed using a conversion table, with valuation based on the petition date.
News
The debtors of the now-defunct cryptocurrency exchange FTX have filed an amended Chapter 11 plan of reorganization which indicates the value of customer asset claims will be retroactively set to the time when the exchange collapsed in November 2022.
In a recent court filing in the United States Bankruptcy Court for the District of Delaware the debtors outlined that any customer entitlement claim, regardless of type of nature, against the exchange aimed at compensating the holder will bebased on the value as of the petition date.
On November 11, 2022, FTX and 130 affiliate companies filed for bankruptcy.
However, the price of Bitcoin (BTC) at the time of filing was $17,036. Meanwhile, at the time of publication, the price stands at $42,272.
Meanwhile, last month, on November 30, FTX was approved to sell approximately $873 million of trust assets, with the proceeds intended to repay creditors of the collapsed exchange.
Related: Sam Bankman-Fried’s lawyer says FTX fraud trial was “almost impossible” to win: Report
Joseph Moldovan, chair of business solutions, restructuring, and governance practices at Morrison Cohen — a New York-based law firm — previously told Cointelegraph that the FTX bankruptcy is fairly complex.
“What’s most unusual about the FTX bankruptcy is that the debtors are complex entities with significant amounts of debt,” he stated.
FTX Debtors have filed the reorg. Plan
Most importantly they have ignored FTX TOS that states Digital Assets are the property of Users and not FTX Trading
The plan says that Digital Assets are valued at Petition Date conversion rates (prices) pic.twitter.com/WTj07nlOP5
— Sunil (FTX Creditor Champion) (@sunil_trades) December 16, 2023
Meanwhile, on December 7, Cointelegraph reported that the FTX 2.0 Customer Ad Hoc Committee proposed to revise the reorganization plan in order to maintain a balance among stakeholder interests.
There has been significant scrutiny of the activities of crypto assets associated with both FTX and Alameda Research in recent times.
On December 9, reports revealed that wallets linked to these defunct entities transferred digital assets worth $23.59 million to multiple crypto exchanges.
Magazine: Lawmakers’ fear and doubt drives proposed crypto regulations in US
