FTX Creditors Strongly Back Reorganization Plan
FTX, a cryptocurrency exchange that faced bankruptcy, has announced that its amended reorganization plan has received robust preliminary support from its creditors, according to a recent press release.
The company and its affiliated debtors stated that the plan, filed with the United States Bankruptcy Court for the District Court of Delaware, has garnered majority backing from all eligible creditor categories indicating significant support across different creditor segments.
FTX Creditors Show Confidence in Reorganization
Unofficial voting reports released by FTX reveal that about 95% of creditors who have voted have favored the reorganization plan, representing 99% of voted claims by value.
This high level of support reflects overwhelming creditor confidence in the proposed reorganization strategy.
- More than two-thirds of all solicited claims by voting value participated in the voting process, meeting necessary thresholds for acceptance under the US bankruptcy code.
Confirmation Hearing & CEO’s Comments
FTX will file the final voting results with the United States Bankruptcy Court for the District Court of Delaware before the Confirmation Hearing on October 7, 2024.
The confirmation hearing will be crucial in determining if the plan can be implemented as proposed.
FTX’s Chief Restructuring Officer and CEO, John Ray III, hailed the significant turnout as strong support and consensus for FTX’s Plan of Reorganization.
Reorganization Plan Details & Future Steps
Details of the reorganization plan were provided by Ray, emphasizing its innovative structure designed to return 100% of bankruptcy claim amounts plus interest to non-governmental creditors.
- The plan aims to maximize recoveries for creditors while resolving disputes with governmental and private stakeholders that have emerged during the bankruptcy proceedings.
Ray highlighted that FTX will continue working closely with creditors and the court to finalize reorganization details in the upcoming weeks.
Ray expressed gratitude for the collaboration with stakeholders and creditors, crucial in advancing the reorganization efforts, and noted the progress towards distributing cash to customers and completing the Chapter 11 process.
Market Reaction & FTT Token Surge
Following the vote favoring the reorganization plan, FTX’s native token, FTT, experienced a significant surge in value. The token rose from $1 earlier this month to $1.4 at the time of writing, marking a 12% increase in the past day.
Hot Take: FTX Reorganization Gains Creditor Support
FTX’s reorganization plan has received strong preliminary backing from creditors, reflecting broad approval across different creditor segments. The significant support signals confidence in the proposed strategy, with voting results showing overwhelming approval from creditors. The upcoming Confirmation Hearing on October 7 will be a pivotal event to determine the plan’s implementation.
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