FTX’s New Proposal Left “Many Important Questions Unanswered”

Recently unveiled plans by FTX debtors to settle customer claims and bring the bankruptcy case to a close have left some important questions unanswered, Bloomberg reported. The new proposal is an amendment to the defunct cryptocurrency exchange Chapter 11 plans.

The newly unveiled reorganization plan reportedly left out some details, which has since raised concerns among creditors. One such unanswered question is how the company will estimate the value of some digital tokens and, importantly, how much creditors can expect to get back.

Furthermore, the company omitted details on whether it will relaunch as a crypto exchange. Previously, the company’s new management said it was considering bids for a possible restart, a report that raised speculations within the crypto community. FTX said the relaunch could be a takeover, partnership, or the management restarting independently.

As earlier reported, parts of the reorganization plans have already caused worry among the crypto exchange’s customers. Importantly, FTX debtors want customers to be repaid the value of their assets as of November 11, 2022 – the day the crypto exchange went bankrupt.

If the plans get passed, customers will be eligible for an amount far less than the prevailing market prices, given the crypto market resurgence. Furthermore, an FTX creditor stated that the reorganization plan ignored FTX terms of services, which says crypto assets remain the customers’ property.

According to Bloomberg, the plan will be put to a vote among creditors next year before being submitted to U.S. Bankruptcy Judge John Dorsey for final approval. Additionally, the report noted that the main customer and creditor groups participating in the Chapter 11 lawsuit have approved the plan’s broad outlines.