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Bankrupt Crypto Exchange FTX Lines Up $16 Billion To Repay Creditors


bankrupt cryptocurrency exchange, FTX he have unveil A new payment plan aimed at Payment of creditors And clients are offering billions in compensation for the time value of their investments.

FTX fully compensates clients

In a press release on May 7, FTX a statement It will pay 98% of its customers at least 118% of allowed claims in cash. the Insolvent crypto exchange Filed a new reorganization strategy with the U.S. Bankruptcy Court in Delaware.

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The reorganization plan, which includes allocating funds to customers affected by FTX's Ponzi scheme, will include a centralized distribution of all of the company's assets during the time of its collapse in November 2022 to its creditors and customers.

The cryptocurrency exchange revealed that it received between $14.5 billion to $16.3 billion, after that Selling assets and property Company owned. This specifically includes assets controlled by Chapter 11 Debtors and Joint Liquidators. FTX Digital Markets Limited.and FTX Australia, as well as several private parties involved in the recovery and payment process.

FTX's payment strategy It sets out a comprehensive approach to repaying creditors, both governmental and non-governmental. The cryptocurrency exchange said it will make full payments to non-government creditors based on the value of their claims determined by the bankruptcy court.

On the other hand, a subordination arrangement for government creditors is proposed, with priority given to interest payments for primary categories of debt. Client And creditors with an interest of up to 9%, and it is implemented in a timely manner.

The payment plan will also create a unique category known as the “Convenience Tier.” With special emphasis on creditors With claims of $50,000 or less. This reorganization will simplify the payment process for small creditors and accelerate the compensation process.

The exchange's revised repayment strategy is still under preparation and awaiting bankruptcy court approval. However, if the plan receives approval, creditors are expected to receive 118% of the value of their allowed claims within 60 days after the effective date of the plan.

Major adjustments in the payment plan

FTX has revealed its new payment reorganization plan Several settlements They are mutually agreed upon with the primary economic stakeholders. As well as some that are still awaiting completion and approval by the court.

One of the major settlements includes a $24 billion solution Claims filed by the Internal Revenue Service (IRS). In exchange, FTX agreed to pay $200 million in cash and issue a subordinated claim for $685 million.

In addition, it owns FTX Proposed agreements with the IRS and the Commodity Futures Trading Commission (CFTC) for secondary tax claims that arose after the commencement of Chapter 11 cases. Furthermore, the cryptocurrency exchange disclosed a previously approved settlement with the joint official liquidators of FTX Digital Markets, Ltd. BlockFiFTX's largest creditor.

FTT Token struggles to break $2 | Source: FTTUSDT on Tradingview.com

Featured image from CoinMarketCap, chart from Tradingview.com

The post Bankrupt Crypto Exchange FTX Lines Up $16 Billion To Repay Creditors first appeared on Investorempires.com.

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