FTX To Repay Creditors Up To $16.5B: Is This Bullish For Bitcoin?
A U.S. bankruptcy judge has approved FTX’s plan to repay creditors up to $16.5 billion, marking the end of the exchange’s two-year bankruptcy process and potentially injecting billions back into the crypto ecosystem.
What Happened: Judge John Dorsey of the U.S. Bankruptcy Court for the District of Delaware approved the reorganization plan, which will see 98% of creditors receive full repayment of their losses, plus additional compensation, DL News reported on Tuesday.
The five-hour hearing on Monday brought closure to one of the most significant collapses in crypto history. FTX founder and former CEO Sam Bankman-Fried was charged with fraud, conspiracy, and money laundering. The situation culminated in his arrest in December 2022; he was sentenced to 25 years in prison on March 28.
FTX expects to distribute between $14.7 billion and $16.5 billion, which John Ray, the executive leading the bankruptcy process, described as “the largest and most complex bankruptcy estate asset distribution in history.”
Judge Dorsey addressed the contentious issue of FTT tokens, declaring them worthless. “I have no evidence today that the value of FTT tokens would be anything other than zero,” he stated, overruling requests from creditors who held the token …