The bankrupted company, FTX, is now given an approved payout plan by the court, and this means that the company will soon repay its creditors as much as $12 billion from what the company owes them. However, it will not be an all-out payment by the company as it would do so gradually according to latest reports, with the first round possibly coming by December with a fraction of the amount.
Despite the gradual payout, it is spelling good news for the crypto industry as it was revealed that it could help boost its numbers and performance once the money from FTX starts rolling in.
FTX to Return $12B of Missing Money to Creditors
Bloomberg's latest report is a slice of good news for FTX creditors as the defunct cryptocurrency company is now approved of its payout plan that will return the missing funds to creditors who are massively owed. FTX currently owes creditors and customers a grand total of $12.6 billion, but it will not come all at once as the company will return the assets and money throughout its plan.
The initial round of disbursement for the money they owe is anticipated to commence this December, moderately returning the funds to creditors who long awaited the money from the company.
Payout to Boost Crypto Industry, Bitcoin Liquidity
Not only would this payout by FTX benefit its creditors who will be getting their money back plus interest, as it was reported that analysts and experts believe it will also help boost the cryptocurrency.
FTX's initial round can only give $1.1 billion back to creditors, but it is perceived to be a significant help in supporting the crypto markets which are facing renowned challenges at present. While money is being returned to creditors, Magnet Capital's co-chief, Benjamin Celermajer, believes that some of it will return to crypto.
It is also expected that FTX's payout will also boost Bitcoin liquidity alongside other assets, a nudge that the crypto industry needs to improve its state.
The Much Awaited Return of FTX Stolen Funds
The Chapter 11 bankruptcy by FTX almost two years ago surprised the world, seeing the crypto behemoth fall and its famed CEO, Sam Bankman-Fried, leaving his post at its lowest point. A massive controversy also followed, pinning SBF for the stolen funds that he embezzled from the company, defrauding its customers and creditors by promising wild claims about FTX's state.
Bankman-Fried was reportedly asked by the court where the funds are, which he denied is with him, and amidst the course of his trial, FTX got ahold of the lost funds worth $7.3 billion, but is not yet all of it. The company's remnants claimed that the money would be used to pay creditors in the future, but they did not give any guarantees as there was still a massive amount missing.
FTX's current CEO, John Ray III, is known for going against Bankman-Fried and his parents during the trial, and he also expressed his intent to pay back its creditors, doing so fully and with interest. The payout plan of FTX will soon be fulfilled by the company to return what is rightfully owned by the company's creditors which SBF defrauded, with this also expected to help the struggling crypto industry.
