FTX and Alameda Research to Repay $12.7 Billion to Creditors

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by Giorgi Kostiuk

2 years ago

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  1. Court Approval
  2. Statements from Key Figures
  3. Impact on Creditors


    4. FTX and its sister company, Alameda Research, have received final approval from a New York judge to repay $12.7 billion to creditors. This approval follows a long-standing lawsuit filed by the United States Commodity Futures Trading Commission (CFTC) against the now-defunct crypto exchange.

    Court Approval

    The approval comes as part of a resolution to a 20-month lawsuit from the CFTC. The settlement agreement includes $8.7 billion in restitution and $4 billion in disgorgement. Notably, the CFTC did not seek a civil monetary penalty.

    Statements from Key Figures

    The CFTC sued FTX, its former CEO Sam Bankman-Fried, and Alameda Research in December 2022. The lawsuit accused the firm of fraud and misrepresentation by marketing FTX.com as a digital commodity asset platform.

    The Proposed Settlement is an integral and valuable component of the Debtors’ proposed chapter 11 reorganization plan.Carlin R. Metzger, Senior Trial Attorney at CFTC, and John J. Ray III, CEO of FTX

    Impact on Creditors

    The proposed reorganization plan promises a 118% return for 98% of the creditors, particularly those with claims under $50,000. This return is based on the US dollar value of asset prices at the time of FTX’s bankruptcy filing in November 2022. However, many creditors have expressed a preference for cryptocurrency payouts, considering the market’s 166% increase in market cap since the bankruptcy filing.

    This settlement marks a major milestone in the resolution of one of the largest crypto lawsuits.

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