FTX has announced that it will repay the money of more than one million victims with interest following its bankruptcy in November 2022.
According to SkyNews, the plan, if approved by the US bankruptcy court, will distribute the proceeds of properties liquidated for a total value of between $14.5 and $16.3 billion within 60 days, with interest of up to 9 percent, to people with claims of $50,000 or less.
Here are all the details you have to know…
What are the details of FTX’s plan?
- Repayment with interest: FTX plans to repay creditors with interest on their money. People with $50,000 or less can receive up to 9 percent interest.
- Rapid distribution: If the plan is approved, FTX aims to pay creditors within 60 days.
- Cash flow: FTX aims to have between $14.5 billion and $16.3 billion in cash for repayments. The company has been raising this cash by cashing in assets for about a year and a half.
- Asset source: Most cash came from investments in FTX-related businesses such as Alameda Research and FTX Ventures.
Creditors’ reaction
FTX CEO John J. Ray III said they were pleased to be able to pay creditors in full, with interest. It is not yet known how creditors will react to the plan.
Possible outcomes
If the plan is approved, FTX’s creditors can recover significant money, which could positively impact the cryptocurrency market.
Some limitations
- Not all creditors may be paid.
- Creditors will not benefit from the increase in the value of cryptocurrencies such as Bitcoin and Ethereum.
- The plan requires the approval of the US bankruptcy court.
FTX’s repayment plan is an important development for the cryptocurrency market. If approved, it could help restore confidence in the market.
Featured image credit: Financial Times / YouTube
