U.S. Court Approves Restructuring Plan for FTX Two Years After Exchange’s Collapse

The United States Bankruptcy Court for the District of Delaware has approved FTX’s reconstruction plan less than two years after the company filed for bankruptcy.

The United States Bankruptcy Court confirmed FTX's Plan of Reorganization at today’s hearing. Further information can be found below. https://t.co/uwR7TxI8jf

— Official Committee of Unsecured Creditors of FTX (@FTX_Committee) October 7, 2024

FTX’s restructuring team has proposed paying customers with claims of less than $50,000—representing 98% of their creditors—within 60 days of court approval, provided they meet the necessary know-your-customer (KYC) and other distribution requirements.

FTX To Announce Distribution Date

The total value of assets recovered and available for distribution is projected to range between $14.7 billion and $16.5 billion. This includes assets managed by the companies undergoing Chapter 11 bankruptcy proceedings and those under the control of the Joint Official Liquidators of FTX Digital Markets Ltd. in the Bahamas and the Administrators of FTX Australia.

Furthermore, the U.S. Department of Justice and numerous private entities that have assisted in asset recovery contribute to the total available distribution. The plan’s effective date and the projected date for the first distribution will be announced separately later.

Estate Aims to Return 100% of Bankruptcy Claims

FTX CEO and Chief Restructuring Officer John J. Ray III expressed that the court’s approval represents a significant step forward in distributing funds to creditors and customers. He acknowledged the efforts of the team working on the case, which has reconstructed FTX’s financial records and secured billions in assets globally.

Ray also highlighted the strong cooperation from various governments and agencies worldwide in addressing the wrongdoings of FTX. He further noted that the estate aims to return 100% of the bankruptcy claim amounts, plus interest, to non-governmental creditors, which could lead to one of the largest and most complex asset distributions in bankruptcy history.

According to Ray, the estate is finalizing arrangements to make distributions across over 200 jurisdictions globally and is securing specialized agents to facilitate the recovery process efficiently and securely. The exchange’s CEO expressed gratitude to creditors and customers for their patience.

“I want to thank all customers and creditors of FTX for their patience throughout this process,” he said.