FTX has recovered enough assets to pay most of its creditors back in full, the failed crypto exchange said late Tuesday as it unveiled a proposed reorganization plan.
“The plan contemplates payment in full of all non-governmental creditors based on the value of their claims as determined by the (relevant) bankruptcy court,” FTX said in a statement.
The plan, which needs to be approved by the US court, would resolve disputes with governmental and private stakeholders “without costly and protracted litigation,” FTX added.
The once high-flying exchange imploded in November 2022, sending shockwaves through the crypto world, after depositors raced to withdraw their cash. Sam Bankman-Fried resigned as CEO and the company filed for bankruptcy.
A year later, Bankman-Fried was found guilty on seven counts of fraud and conspiracy, including on stealing billions from accounts belonging to FTX customers and defrauding lenders to its sister company, the hedge fund Alameda Research. He was sentenced in March to 25 years in prison.
FTX said Tuesday it had recovered assets associated with the exchange at the time of its collapse with an estimated value of between $14.5 billion and $16.3 billion.
John J. Ray III took over as CEO in November 2022 to shepherd what was left of the firm through bankruptcy. Within a week, the man who had previously overseen the liquidation of Enron had declared FTX the biggest mess he’d ever encountered.
Ray said in Tuesday’s statement: “We are pleased to be in a position to propose a Chapter 11 (bankruptcy) plan that contemplates the return of 100% of bankruptcy claim amounts plus interest for non-governmental creditors.”
If his plan is approved by the United States Bankruptcy Court for the District Court of Delaware, FTX expects that 98% of its creditors will receive approximately 118% of the amount of their allowed claims, FTX said.
