FTX Creditors Endorse Reorganization Plan

FTX announced overwhelming support from creditors for the updated exchange reorganization plan. Preliminary data shows 95% of votes in favor, representing 99% of the claim amounts.

Given these figures, the results are expected to surpass the Bankruptcy Code threshold for approval by the Delaware District Court. FTX will submit the final numbers to the court before the hearing on October 7, 2024.

FTX CEO John Ray III emphasized the active participation of stakeholders and the consensus in approving the plan.

“It is important to note that the innovative structure of the proposal provides for the return of 100% of the claim amounts plus interest for non-government creditors and resolves complex disputes with dozens of governmental and private participants in the bankruptcy process,” he added.

Earlier, another proposed reorganization plan for the exchange faced criticism from creditors.

Meanwhile, lawyers for the former head of FTX’s Bahamian division, Ryan Salame, asked the court to ensure the US Department of Justice adheres to his plea agreement.

The ex-manager struck a deal with authorities in September 2023. The Southern District of New York Court sentenced Salame in May 2024 to 90 months (7.5 years) in prison. As part of the proceedings, $6 million was confiscated from him, and the top manager also paid over $5 million in restitution.

Salame’s lawyers claim that the prosecution violated agreements to cease investigations into his partner and mother of their child, Michelle Bond.

Authorities accuse the former US Congressional candidate, now head of an analytical fintech center, of breaching campaign finance rules in 2022. This includes contributions from FTX-affiliated individuals and entities.

Salame’s defense argues that prosecutors induced his guilty plea with promises not to pursue Bond. The ex-manager’s lawyers are asking the court to either enforce the agreement or overturn the conviction.

In July, Salame was allowed to delay the start of his prison term to October 13 due to injuries from a dog attack.