The long-awaited FTX Derivatives Exchange reorganization plan now have a specific date for creditors to expect payment.
As the defunct exchange revealed in a recent press release, the official reorganization plan will commence in January 2025.
FTX said it is completing the final pre-requisites that will make this payout and timeline feasible.
The trading platform confirmed in a press release that this reorganization plan will pave the way for it to begin creditor and customer distributions.
Prior to the January 2025 deadline, the exchange said it will finalize its arrangements with its specially designated distribution agents.
To be eligible for payouts, customers will need to create an approved account with the distribution agents.
The trading platform said it will announce the specific dates to that it will begin the distribution in January.
This announcement is subject to a court order. The announcement detailed that the first distribution will come in about 60 days after the Court Order is approved.
Beyond the setting up of account with the distributing agents, creditors will also need to “complete KYC verification and submit the required tax forms prior to the distribution record date.”
This latest update comes after the court approved its bankruptcy plan in October.
Under this reorganization plan, FTX will distribute over $6.6 billion to customers.
This plan got support from about 96% of all creditors, making it one of the most comprehensive proposals for repayment.
While the approved plan will repay users more than 100% of their locked funds, the payout will go out in USD.
Key stakeholders in the bankruptcy proceedings including Sunil Kavuri believes this is a major ruboff.
At its prime, FTX Derivatives Exchange proved itself in many ways as the fastest growing trading platform in the industry.
However, co-founder and former CEO, Sam Bankman-Fried (SBF) created a backdoor to siphone about $8 billion in customer funds.
With frivolous donations and investments, the FTX balance sheet developed a huge hole which when discovered, forced it to file for bankruptcy.
For the role played in its collapse, Bankman-Fried bagged a 25-year jail term.
Other executives like Ryan Salame and Caroline Ellison also scored 7.5 and 2 year jail terms respectively.
Meanwhile, Gary Wang escaped prison despite building the software that helped SBF steal the funds.
Beyond what the community saw as fair, positive reaction has trailed the FTX reorganization plan in the community.
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