FTX: Customer reimbursement plan approved

By Daniele Corno

Exchange FTX bankruptcy plan is approved, full refund in FIAT currency for customers at November 2022 prices

The repayment plan

On Monday evening, a Delaware court judge approved the repayment plan for customers of FTX, the exchange declared bankrupt in November 2022.

Under the plan, 98 percent of customers will receive a refund of between 118 percent and 140 percent of the principal deposited on the platform. Payments will be made in FIATcurrencies , as planned.

Refunds will be processed within 60 days after the plan goes into effect, a date yet to be determined.

However, not all that glitters is gold. The value of the repayment will be calculated based on the value of the assets at the time of bankruptcy, in November 2022. On that date, November 11, Bitcoin was trading around $17,000. As a result, although the plan includes a bonus over the original amount, customers will see a refund of just over 25 percent of the current value of their lost assets.

Several objections during a 6-hour hearing

The plan, approved less than two years after the bankruptcy, was made possible by the work of liquidators, who recovered the assets. The increased value of assets held by FTX and Alameda also played a key role.

Despite the positive outlook, some objections were raised during the hearing. The first concerns the method of repayment in FIAT currencies instead of cryptocurrencies. The second objection concerns the value placed on the platform’s FTT token. Both were rejected: the judge ruled that the face value of the FTT token is zero.

FTT's reaction and a stablecoin refund?

“Experts have explained that FTT has no intrinsic value and no utility outside of an operational exchange, “ Glueckstein said. “There will be no restart of FTX.com.”

Following the news, the FTT token surged 70 percent from a low of $2 to a high of $3.4, then back down to values below $2.5.

Finally, the possibility of redemption via stablecoin has been considered, although this option is still being evaluated. The U.S.Securities and Exchange Commission has raised numerous objections to this mode.