FTX creditors continue to hold out hope for a favorable outcome following the exchange’s collapse in November 2022. With crucial restructuring decisions pending, there is anticipation of market volatility driven by creditor payments expected to start in Q4.
Sunil Kavuri, an FTX creditor activist, suggests that creditors could receive between 10% and 25% of their crypto back. This estimate arises as FTX allocates 18% of forfeiture funds (€230 million) to equity holders, raising concerns.
The court will decide on the restructuring plan around October 7. However, uncertainty lingers about whether repayments will be in crypto or cash, impacting market withdrawals.
In the past two months, the court approved a $12.7 billion repayment plan but banned FTX and Alameda Research from trading digital assets. The US trustee has raised objections to the reorganization plan, advocating for equitable distribution among creditors.
The SEC has also questioned the plan, demanding the removal of certain provisions. Consequently, the market awaits significant impacts, with FTX's existing $1 billion in Solana tokens possibly influencing Solana's valuation and repayments potentially injecting new capital into Bitcoin and altcoins.
