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FTX debtors have established January 3, 2025, as the initial distribution date for its court-sanctioned Chapter 11 Plan of Reorganization, occurring just over two years after the collapse of Sam Bankman-Fried’s cryptocurrency exchange in November 2022.
FTX Debtors To Compensate Victims Of Failed Crypto Exchange
As stated in a press release from FTX and its associated debtors on December 16, claimants can anticipate the initial distribution to commence within 60 days of the effective date.
Crypto firms BitGo and Kraken will partner with FTX under an agreement to aid in the distribution of recoveries to both retail and institutional investors as outlined in the plan.
FTX ANNOUNCES EFFECTIVE DATE AND RECORD DATE OF JANUARY 3, 2025 FOR ITS CHAPTER 11 PLAN OF REORGANIZATION – RTRS
— unfolded. (@cryptounfolded) December 16, 2024
“Over the past two years, our team of professionals has diligently and effectively worked to recover billions of dollars to reach this milestone,” stated John Jay Ray III, CEO of FTX debtors. “The Plan becoming effective in January 2025 and the initiation of distributions are testaments to the remarkable success of the recovery efforts.”
“We are well-prepared to commence the distribution of recoveries back to all customers and creditors, and we urge customers to complete the necessary steps to ensure timely receipt of distributions,” Ray concluded.
The announcement of the effective date follows just one month after U.S. Bankruptcy Judge John Dorsey approved FTX’s bankruptcy plan in October.
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According to an October 2024 press release from the crypto exchange, the finalized plan will enable 98% of FTX creditors to receive 119% of their allowed claims, subject to certain conditions.
“I want to express my gratitude to all customers and creditors of FTX for their patience throughout this process,” Ray remarked at that time, highlighting that funds would be distributed to creditors across 200 jurisdictions worldwide.
Sam Bankman-Fried & Associates Confront Consequences
Monday’s announcement hopefully signifies the beginning of the conclusion of a two-year journey for FTX victims following the exchange’s downfall in November 2022.
In November 2023, Bankman-Fried was sentenced to 25 years in federal prison for orchestrating the extensive crypto scheme that defrauded investors of over $8 billion, which was allocated to venture capital, real estate acquisitions, and political contributions.
Former Alameda Research CEO Caroline Ellison received a two-year prison sentence last fall, although her term has since been shortened due to good behavior.
Other FTX executives, Nishad Singh and Gary Wang, received no prison sentences for their involvement in the scandal shortly after Ellison’s sentencing.
Overall, the FTX scandal will be remembered as one of the largest financial and crypto frauds ever committed.
The post FTX Sets January 3, 2025 as Date for Chapter 11 Reorganization Plan appeared first on Cryptonews.
