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FTX Creditors Say Payout Deal Is 'an Insult'—and Plan to Revolt
FTX has a plan to repay its former crypto customers more than the billions of dollars they lost in the latest bankruptcy proposal. But some will reject it anyway.
Under the proposed plan, government bodies in the United States—including the Internal Revenue Service and the Commodities and Futures Trading Commission—have agreed to suspend high-value claims against FTX until creditors had been repaid (although the IRS will receive a $200 million upfront payment as part of the settlement). Under one particular clause, FTX pledges not to pursue preference actions—a type of lawsuit that aims to claw money that had left company coffers in the period immediately before a bankruptcy back into the estate—against customers who raced to withdraw their crypto, but only if they vote in favor of the plan. Under the plan, FTX will replace its present board of directors with new members of its choosing, and the Committee of Unsecured Creditors (UCC), which has a formal voice in the bankruptcy, will be disbanded.
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