FTX debtors have finalized January 3, 2025 as the initial distribution date for its court-approved Chapter 11 Plan of Reorganization just over two years after the Sam Bankman-Fried’s crypto exchange collapsed in November 2022.
FTX Debtors To Pay Back Victims Of Doomed Crypto Exchange
According to a December 16 press release from FTX and its affiliated debtors, claimants can expect initial distribution to take effect within 60 days of the effective date.
Both crypto firms BitGo and Kraken will collaborate with FTX as part of an agreement with the crypto exchange to assist in distributing recoveries to retail and institutional investors in accordance with the plan.
“For the past two years, our team of professionals have meticulously and efficiently worked to recover billions of dollars to reach this point,” CEO of FTX debtors John Jay Ray III said in a statement. “The Plan becoming effective in January 2025 and the start of distributions are reflections of the outstanding success of the recovery efforts.”
“We are well positioned to begin executing the distribution of recoveries back to all customers and creditors, and encourage customers to complete the necessary steps to begin receiving distributions in a timely manner,” Ray concluded.
News of the effective date comes just one month after FTX’s bankruptcy plan was finally approved by U.S. Bankruptcy Judge John Dorsey in October.
According to an October 2024 press release from the crypto exchange, the finalized plan will see 98% of FTX creditors receive 119% of their allowed claims realized subject to requirements.
“I want to thank all customers and creditors of FTX for their patience throughout this process,” Ray said in a statement at the time, noting that they would be distributing funds to creditors in 200 jurisdictions over the globe.
Sam Bankman-Fried & Associates Face The Music
Monday’s news hopefully marks the beginning of the end of a two year process for FTX victims following the exchange’s collapse in November 2022.
In November 2023, Bankman-Fried was sentenced to 25 years in federal prison for orchestrating the massive crypto scheme that saw investors defrauded of over $8 billion that was spent on venture capital, real estate purchases, and political donations.
Former Alameda Research CEO Caroline Ellison was sentenced to two years behind bars this past fall, though has since reduced her sentence thanks to good behavior.
Fellow FTX executives Nishad Singh and Gary Wang both received no prison time for their role in the scandal shortly following Ellison’s sentencing.
All in all, the FTX scandal will go down as one of the largest financial and crypto frauds ever perpretrated.
The post FTX Sets January 3, 2025 as Date for Chapter 11 Reorganization Plan appeared first on Cryptonews.
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