FTX, a leading cryptocurrency derivatives exchange, has revised its reorganization plan that will address the valuation and treatment of cryptocurrency assets held by investors who participated in the original restructuring process earlier this year. FTX’s most recent reorganization plan comes in light of a stalemate between the exchange and its creditors over the issue of how to value and treat its cryptocurrency assets.
Under the agreement, FTX will address claims for digital assets held by investors who were impacted by the April 2020 BitMEX restructuring by offering a combination of cash, cryptocurrency, and tokenized claims. The valuation for digital claims will be based on an average of market prices for that asset during a 14-day period across various trading platforms.
Investors who wish to accept cash payments must accept 80 percent of the claim’s issued value in cash, and the remaining 20 percent in either cryptocurrency or tokenized claims. For those who prefer to receive cryptocurrency, the claim value must remain within the issuer’s “acceptable range,” beginning at the lowest market price within the 14-day period and ending at the highest. Tokenized claims holders will have a seven-day period to convert their claims into cryptocurrency.
The revised reorganization plan is an attempt to find a middle ground between FTX and its creditors, who have been at a standstill over the issue of how to value and treat cryptocurrency assets held by investors affected by the restructuring.
While the revised plan provides a framework for addressing the issue, it remains to be seen if FTX and its creditors can come to an agreement that will be acceptable to all parties involved. In the meantime, the fate of the exchange’s roughly $20 million in digital assets hangs in the balance.