FTX whales scorn 118% restructuring plan: Liquidation team stole our money

FTX's restructuring team submitted a revised restructuring plan to the court on 5/7. If approved by the bankruptcy court, 98% of FTX's creditors will receive 118% of their allowed claim amount within 60 days after the plan takes effect. However, this news has left prominent FTX creditor Sunil Kavuri dissatisfied, as he believes that FTX's law firm, Sullivan & Cromwell, is once again playing dumb and using the media to create a false impression of "customers winning big".

FTX also offers a 9% interest, and creditors with claims under $50,000 will receive 118% of the claimable amount within 60 days.

"The Liquidation Team Stole Our Money!"

FTX creditor Sunil Kavuri responded to the restructuring plan released by FTX today, pointing to the report and questioning what is meant by "Users get more back than owed," suggesting it as a headline put out by FTX's legal team to the media.

Assets owned by FTX users, and what FTX is willing to compensate beyond market price differentials, is what FTX actually owes. Just because this money was stolen does not mean Sullivan & Cromwell can ignore such obligations. He mentioned that even a U.S. Department of Justice judge in the SBF ruling agreed.

Nevertheless, the related court litigations and proposals seem to have not gained approval, and FTX's liquidation compensation plan is currently being calculated based on liquidation prices from bankruptcy times.

FTX creditors received a letter from Kroll? Claim conversion prices summary: BTC 16K/ETH 1.2K/SOL 16/FTT not counted

Unfair Restructuring Plan

Angry FTX major creditor Sunil once again criticized what he deemed an unfair restructuring plan. Summarized as follows:

- FTX law firm S&C included indemnity clauses, so they won't be sued for misconduct

- He believes S&C controls the restructuring lawyer John Ray but avoids responsibility

- Petition price +18% (<$50,000; 25% to 47% >$50,000)

- Payment by check

- If checks are not cashed within 6 months, the right to claim is lost

He believes a vote against the plan should be cast.

Because S&C/debtors owe FTX customers the current value of their held assets (3 to 10 times the petition price). S&C destroyed over $10 billion in value expected by FTX creditors.

SBF sentenced to 25 years in prison for violating terms of service and embezzling customer deposits.

S&C is a defendant in Sunil's collective lawsuit for aiding/abetting SBF fraud, claiming:

Each defendant should be responsible for FTX customer losses, compensated based on current prices.

FTT Mysteriously Surges

Interestingly, in the liquidation process, FTT, which was valued at 0, surged by 25% today: