FTX lawyers stressed that in-kind crypto payouts would clash with bankruptcy laws but several creditors feel shortchanged by the proposed cash repayments plan.
FTX has received court approval to ask creditors whether they would prefer to receive their recovered funds in cash — under FTX‘s current liquidation plan — or in crypto at its current market value.
United States Bankruptcy Judge John Dorsey granted FTX the voting plan approval on June 25.
Several FTX creditors weren’t pleased with FTX’s latest liquidation plan in May which proposed a 118% return to 98% of creditors — those with claims under $50,000 — to be repaid at a U.S. dollar value of asset prices at the time FTX filed for bankruptcy in November 2022.