The US bankruptcy court has approved FTX’s proposal to distribute between $14.7 billion and $16.5 billion in payouts to the former customers of the crypto exchange. This plan is set to benefit 98% of the exchange’s creditors, who will receive approximately 119% of the value of their holdings at the time FTX filed for bankruptcy in November 2022.
The increased payouts are a result of higher crypto prices and FTX’s 8% stake in the AI safety and research company Anthropic. The creditors’ digital asset claims are based on the crypto prices at the time of FTX’s collapse in November 2022, which were at near-bottom levels due to the turmoil surrounding the exchange.
John J. Ray III, the CEO of FTX, expressed his gratitude towards the team handling the case for their efforts in recovering billions of dollars by reconstructing the exchange’s books and gathering assets from various locations worldwide. Ray III also announced plans to return 100% of bankruptcy claim amounts plus interest to non-governmental creditors, making it the largest and most intricate bankruptcy estate asset distribution in history.
Following the bankruptcy filing, Ray III took over from former CEO Sam Bankman-Fried, who was found guilty of wire fraud, conspiracy to commit wire fraud, securities fraud, commodities fraud, and money laundering against FTX’s customers and investors. Bankman-Fried was sentenced to 25 years in prison, along with a $11 billion forfeiture order. Despite appealing his conviction and sentence, the former CEO’s legal troubles continue.
As FTX prepares for the distribution of assets to creditors across more than 200 jurisdictions worldwide, specialized agents will be retained to facilitate the process efficiently and securely. The goal is to ensure that all customers receive their recoveries in a timely manner.
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