Collapsed cryptocurrency exchange FTX is moving closer to resolution as a majority of its creditors have voted to approve the <a href="https://thecoinrise.com/ftx-trustees-and-creditors-objects-to-reorganization-plan/" rel="noopener noreferrer nofollow">company’s reorganization plan</a>. According to a Monday <a href="https://restructuring.ra.kroll.com/FTX/Home-DownloadPDF?id1=MzIxNDIwMw==&amp;id2=-1" rel="noopener noreferrer nofollow">filing</a> by Kroll Restructuring Administration, over 94% of FTX Dotcom clients supported the plan, marking a critical step forward in the lengthy bankruptcy process.
The voting, which ended in August, revealed that nearly all classes of FTX creditors overwhelmingly voted to accept the plan. Two classes of creditors did not return their ballots, but these were presumed to approve the reorganization. This support paves the way for FTX to proceed with its proposed payout framework, though the full distribution of funds remains uncertain.
<h2 id="span-style-font-weight-400-ftx-creditors-to-recover-at-least-118-of-claims-span">FTX Creditors to Recover at Least 118% of Claims</h2>
The filing shows that 94.48% of creditors in the “dotcom customer entitlement claims” class—representing claims worth approximately $6.83 billion—voted in favor of the restructuring plan.
Similarly, 89.1% of U.S. customer creditors, holding around $60.99 million in claims, also backed the plan. Another major group, the “dotcom convenience claims” class, saw an even higher approval rate, with 95.88% voting in favor, representing $223.59 million in claims.
Under the proposed <a href="https://www.prnewswire.com/news/ftx/" rel="noopener noreferrer nofollow">reorganization</a>, around 98% of FTX’s creditors will receive at least 118% of their claim value in cash, based on the value of the relevant cryptocurrencies at the time the claims were evaluated. Despite this, many creditors are bracing for a substantial haircut, with recent bankruptcy documents indicating they may only recover 10-25% of their cryptocurrency holdings.
<h2 id="span-style-font-weight-400-october-confirmation-hearing-set-span">October Confirmation Hearing Set</h2>
The next major milestone for the reorganization plan will be the confirmation hearing, scheduled for October 7. This will determine whether the court finalizes the plan, setting the path for payouts to begin.
In a previous ruling, a New York judge authorized <a href="https://thecoinrise.com/judge-approves-12-7-billion-settlement-for-ftx-creditors/" rel="noopener noreferrer nofollow">FTX and its sister company, Alameda Research, to repay up to $12.7 billion</a> to creditors. While this figure sounds promising, the reality of what creditors can expect to recover remains bleak, especially in the context of volatile cryptocurrency markets.
Activist Sunil Kavuri, who has been closely following the case, noted that despite these approvals, <a href="https://thecoinrise.com/u-s-judge-orders-ftx-and-alameda-to-pay-12-7-billion-to-creditors/" rel="noopener noreferrer nofollow">FTX creditors face the “grim reality” of recovering</a> only a fraction of their original assets.
The post <a href="https://thecoinrise.com/ftx-creditors-signal-massive-support-in-favor-of-reorganization/" rel="noopener noreferrer nofollow">FTX Creditors Signal Massive Support in Favor of Reorganization</a> appeared first on <a href="https://thecoinrise.com/" rel="noopener noreferrer nofollow">TheCoinrise.com</a>.

FTX Creditors Signal Massive Support in Favor of Reorganization

Table of Contents

TheCoinrise Media

Other articles published on Oct 1, 2024

Bitcoin Rises Rapidly as BlackRock Boosts Its ETF Investments

BlackRock Names Key Reason Behind Ethereum ETF Failure

CryptoRank Report: Here are the top gainers in Q3 2024

Shiba Inu Burn Rate Soars: Is SHIB Ready for a Price Explosion?

Ripple Secures UAE Financial License from Dubai Authority

FTX creditors to recover just 10-25% of their funds as the restructuring plan faces legal hurdles

Join our free newsletter for daily crypto updates!