FTX Debtors Get Reduced Maximum Settlement Value For Claims From $10M To $7M: Report

Key Points:

• FTX’s debtors revise their settlement proposal after the US Trustee’s objection.
• The new proposal reduces the maximum settled value for claims from $10M to $7M and includes the US Trustee as a party.
• Debtors are also responsible for monthly reporting on payments made.
• The US trustee had objected to the previous offer saying $10 million was too high to constitute a “small” claim.

Coindesk recently reported that it revealed a document that says bankrupt crypto exchange FTX has revised its settlement offer after facing objections from the US Commissioner.

According to court documents filed on Sunday, after the US trustee objected to the previous petition, the debtor of crypto exchange FTX modified the settlement petition.

In the latest proposal, debtors would list US trustees as interested parties and reduce the maximum settlement value of due process claims to $7 million from $10 million previously. The debtor will also submit a monthly report on payments made.

It is understood that all objections of the Related Party will need to be resolved or resolved by court order before the complaints process can proceed.

The US trustee had previously opposed the offer, saying that $10 million was too high to constitute a “small” claim and did not even provide sufficient notice of the nature of the request.

On November 11, 2022, FTX and several of its affiliates filed for bankruptcy in Delaware in one of the most severe crypto bankruptcies ever, making an estimated 1 million Customers and other investors face losses totaling billions of dollars. The crypto exchange owes the 50 largest creditors nearly $3.1 billion.

On July 13, FTX launched the Online Claims Portal for customers. The portal will allow customers to log in with their FTX credentials to view historical transaction information and account balances as of November 11, 2022. 1 Customers who agree to the stated amount or quantity, the FTX Exchange to the person who confirms the customer claim, and the type or nature of the customer claim as listed will not need further action to take any action other than submitting Know Your Customer (“KYC”) information.

DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.