Debtors of the now-defunct cryptocurrency exchange FTX have filed a modified Chapter 11 reorganization plan stating that the value of customers' asset claims will be set retroactively to the time the exchange collapsed in November 2022.
In a recent court presentation In the United States Bankruptcy Court for the District of Delaware, the debtors described that any customer right claim against the exchange intended to compensate the holder will be based on the value as of the date the exchange filed for bankruptcy on November 11, 2022.
It was stated that the value of a claim will be determined by the cash value of the crypto asset using conversion rates specified in a conversion table.
However, there has been a surge in cryptocurrency prices since the bankruptcy filing. Bitcoin (btc) was valued at $17,036 during filing, but at the time of publication, the price is $42,272.
Meanwhile, last month, on November 30, the sale of FTX was approved. approximately $873 million of the trust assets, with the proceeds going to pay creditors of the collapsed exchange.
Related: Sam Bankman-Fried's Lawyer Says FTX Fraud Trial Was 'Nearly Impossible' to Win: Report
Joseph Moldovan, president of business solutions, restructuring and governance practices at Morrison Cohen, a New York-based law firm, previously explained to Cointelegraph the complexities of the FTX bankruptcy.
"The most unusual thing about the FTX bankruptcy is that the debtors are complex entities with significant amounts of debt," he said.
FTX debtors have filed for reorganization. Plan
Most importantly, they have ignored FTX's TOS which states that digital assets are owned by users and not FTX Trading.
The plan says that digital assets are valued based on the conversion rates (prices) on the date of the request. pic.twitter.com/WTj07nlOP5
- Sunil (FTX Creditors Champion) (@sunil_trades) December 16, 2023
Meanwhile, on December 7, Cointelegraph reported that the FTX 2.0 Ad Hoc Client Committee proposed to review the reorganization plan to maintain a balance between the interests of interested parties.
Furthermore, there has been significant scrutiny of the activities of cryptoassets associated with both FTX and Alameda Research in recent times.
On December 9, reports revealed that wallets linked to these defunct entities transferred digital assets worth $23.59 million to multiple crypto exchanges.
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