FTX proposes new restructuring plan: 98% of creditors will receive 118% cash return

FTX has proposed a dramatic new restructuring plan that promises to return 118 per cent of its claims to 98 per cent of its creditors within 60 days of court approval, marking the bankruptcy exchange's unprecedented offer of compensation to its victims. In addition to creditors, other non-government creditors will also receive 100% of their claims and up to 9% interest. The proposed plan, which exceeds FTX Properties' previous estimates, has caught the attention of the market.

While FTX's bankruptcy has sparked discontent among many customers, FTX Property denies that the market recovery is the main driver behind its large cash pile. The cash pool was formed through a year-and-a-half effort to raise and liquidate the company's assets around the world, they said. In addition to the cash, FTX's new restructuring plan will also resolve claims from regulators and government agencies, and it plans to create a special fund that will be used to provide "supplemental compensation" to certain customers and creditors. In addition, the shadow of former FTX CEO Sam Bankman-Fried continues to hang over FTX, who was sentenced to 25 years in prison for his alleged fraud, although he tried to reduce his sentence by using his estate to repay customers in full.

This move by FTX has caused much discussion and attention in the cryptocurrency market. While still awaiting final approval from the Delaware Bankruptcy Court, the filing of this plan demonstrates FTX Properties' commitment to resolving the bankruptcy and providing fair and adequate compensation to its victims. It could also have significant implications for the future regulation and governance of cryptocurrency exchanges, as it would be an unprecedented case of how to handle a bankruptcy event in the cryptocurrency industry.