- FTX announces its Chapter 11 Plan of Reorganization will become effective on January 3, 2025, which is also set as the initial distribution record date for allowed claims in the Convenience Classes
- The initial distribution is expected to occur within 60 days of the Effective Date, with FTX entering into agreements with BitGo and Kraken to assist in distributing recoveries
- Customers and creditors must complete KYC verification, submit tax forms, and onboard with BitGo or Kraken before the January 3, 2025 record date to be eligible for the initial distribution
FTX Trading Ltd, also known as FTX.com, and its affiliated debtors, collectively referred to as the “FTX Debtors”, recently announced the Court-approved implementation date for its Chapter 11 Reorganization Plan. The plan is set to become effective on January 3, 2025, which will also serve as the initial distribution record date for claim holders in the plan’s Convenience Classes.
Setting the Stage for the Initial Distribution
The Initial Distribution is expected to take place within 60 days of the plan’s implementation. However, participation is subject to certain requirements such as know-your-customer (KYC) and other distribution prerequisites. The Initial Distribution is restricted to the plan’s Convenience Classes, with separate record and payment dates for other classes of claims to be announced in the near future.
Reflecting on the Success of the Recovery Efforts
John J. Ray III, the Chief Executive Officer of the FTX Debtors, expressed satisfaction with the progress made so far. He highlighted the team’s ability to recover billions of dollars over two years and stated that the plan’s implementation and commencement of distribution are testament to the success of the recovery efforts.
Partnerships for Efficient Distribution
FTX has also entered into agreements with two companies, BitGo and Kraken, to aid in distributing recoveries to both retail and institutional customers and other creditors in supported jurisdictions, in accordance with the plan. BitGo is a globally regulated custodian providing institutional-grade trading, settlement services, and more, while Kraken is a leading US-based cryptocurrency exchange.
Eligibility and Precautions for Initial Distribution
For customers and other creditors to be eligible for the Initial Distribution, they must complete KYC verification, submit required tax forms, and onboard with BitGo or Kraken before the distribution record date. FTX has cautioned its customers to be wary of phishing emails and scam sites that may disguise themselves as the FTX Debtors’ Customer Portal.
Conclusion
As the FTX Debtors prepare for the implementation of their Chapter 11 Reorganization Plan, they continue to take steps to ensure a smooth and efficient distribution process. They remain committed to returning recoveries to all customers and creditors and urge them to take necessary steps to receive distributions in a timely manner.
