FTX announces its Chapter 11 plan’s effective date as January 3, 2025, with BitGo and Kraken assisting in customer recovery.
FTX, the cryptocurrency exchange once led by convicted founder Sam Bankman-Fried, has set a date for its Chapter 11 reorganization plan. After years of uncertainty, the exchange announced that the plan would take effect on January 3, 2025. This date will also be the first distribution record date concerning the holders of allowed claims within the plan’s Convenience Classes.
The Initial Distribution will be made within 60 days of the effective date. But it will entail customers’ know-your-customer (KYC) and other distribution requirements to participate. As for the Initial Distribution, it should be mentioned that this process is only applicable to the Convenience Classes. Other claim classes will have records and payment dates which shall be communicated at a later date.
On this occasion, the chief executive officer of FTX Debtors, John J. Ray III, shared his views. He said that the company has been struggling for two years trying to regain billions of dollars. He said he is optimistic that the company is ready to start paying its customers and creditors. They urged those who had been affected to follow the right procedures so that they could receive their distributions as soon as possible.
FTX Moves Ahead with Distribution Plan with BitGo and Kraken Support
To help with the distribution, FTX has signed deals with two firms. BitGo, a globally regulated custodian, will help with trading and settlement for institutional standards. The company was founded in 2013 and has been catering to both individual and institutional clients. Another participant in the fund-raising campaign will be Kraken, a famous American Bitcoin exchange platform that will also contribute to the distribution of the recoveries. Kraken is one of the oldest crypto exchanges launched in 2011 and is present in up to 190 countries and provides features such as spot trading and regulated derivatives.
Where a customer has transferred claims, any distributions will be made to the transferee holder of an allowed claim. The claim has to be addressed, and the reference has to be made to the official register, which is controlled by the Notice and Claims Agent. Claims must be listed by the January 3, 2025 record date, and the 21-day notice period must pass without objections.
This announcement can be considered a significant milestone for FTX to expand its business further. This has the effect of moving the company ahead in its process of coming out of bankruptcy. There is now a clear path to distribution, which is planned to commence in January 2025. FTX’s recovery efforts, supported by BitGo and Kraken, aim to compensate affected customers. This will provide a much-needed resolution to those impacted by the exchange’s collapse.
