Unsecured FTX creditors claimed they didn't have "a single call or meeting" with FTX to discuss the Chapter 11 exit plan.
FTX's latest draft bankruptcy exit plan has not gone down well with its unsecured creditors. A representative body of FTX customers expressed significant dissatisfaction, criticizing the plan for ignoring their input and concerns.
The FTX's Official Committee of Unsecured Creditors (UCC) recently filed the documents in court on July 31st, highlighting their discontent with the drafted Chapter 11 plan. UCC claims that their repeated requests and prior assurances for dialogue had been overlooked. They emphasized not having "a single call or meeting" with FTX to discuss the plan.
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The plan in question outlines customer claims and segments them into various classes. It also maps out a strategy for FTX to re-launch as an offshore exchange. However, the UCC warned that if their voice continued to be silenced, they would propose their own plan, allowing FTX customers to cast their votes.
The UCC was particularly unhappy with what it saw as a late filing of the plan, deeming it to give "the appearance of progress." They criticized the one-sided nature of the Chapter 11 plan and felt their suggestions were largely dismissed.
Put simply, the Debtors chose to publicly file their ideas for a plan.
Furthermore, concerns were raised regarding the lack of appointment of someone with adequate crypto expertise to manage a possibly rebooted FTX. The UCC believes the plan must create a regulatory-compliant recovery token and distribute value to customers severely affected by FTX's downfall.
Yet, it's not all conflict. The UCC also acknowledged a positive sign that the restructuring team was open to revising the plan to embrace the UCC's suggestions.
This will take willingness on the part of the Debtors to listen and engage and not attempt to substitute their judgment for that of the parties who truly know and understand the cryptocurrency markets.
The unfolding situation at FTX highlights the importance of clear communication and collaboration, especially in an area as complex and volatile as cryptocurrency. While the restructuring team's willingness to amend the plan is promising, the dissatisfaction of the creditors underlines a significant disconnect.
