- Over 94% of Dotcom creditors support FTX’s reorganization plan.
- A confirmation hearing is scheduled for October 7, 2024, to finalize the reorganization.
FTX’s reorganization plan has gained overwhelming support, with a significant majority of Dotcom voting creditors approving it. According to the final report released by the Kroll Restructuring Administration, 94.48% of creditors who returned their ballots voted in favor of the proposal.
This support marks a crucial step toward resolving FTX’s bankruptcy. Moreover, it facilitates the redistribution of assets back to creditors. Estimates suggest that the recovery and distribution of assets will amount to between $14.5 billion and $16.3 billion. This figure covers various entities involved in the bankruptcy proceedings, including FTX Digital Markets.
The reorganization plan also includes specific provisions for U.S.-based creditors. Notably, 89% of these creditors support the proposal. These creditors can expect to receive up to 118% of their claims, which provides a substantial return on their losses. Additionally, the plan outlines a repayment structure that includes interest payments of up to 9% for major creditors. These payments will be calculated from the start of Chapter 11 proceedings until distributions are complete.
FTX’s Reorganization: Creditor Support and Legal Hurdles
The final confirmation hearing is scheduled for October 7, 2024. This hearing will be pivotal in finalizing the reorganization. If approved, the plan will allow creditors to begin recovering their assets. While the process moves forward, FTX continues to face legal challenges. Ongoing litigation involves its former executives, including Sam Bankman-Fried. His involvement in the company’s collapse has led to criminal charges and other legal hurdles.
This overwhelming support reflects a positive outlook among creditors. The reorganization plan offers a clear path toward asset recovery. FTX’s management remains optimistic about the plan’s approval at the upcoming hearing. Overall, the plan is expected to restore confidence in the process. It also provides much-needed clarity for those affected by the bankruptcy. With such strong approval ratings, this restructuring could become a turning point in resolving one of the largest crypto bankruptcies in history.
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