FTX’s two halves have agreed on a strategy to maximize stakeholder recoveries.
According to a press release issued on January 6, the two halves of FTX — its debtors in the United States and its liquidators in the Bahamas — have agreed on an asset recovery plan.
Although discussions will continue, FTX CEO and Chief Restructuring Officer John J. Ray III stated that many issues have been resolved. He stated, “
“We would like to thank all of the Joint Provisional Liquidators of FTX DM… There are some issues where we do not yet have a meeting of the minds, but we resolved many of the outstanding matters and have a path forward to resolve the rest.”
According to the full press release, the two parties will collaborate on a variety of projects. The parties will exchange information, arrange for the return of property, and file legal action against the other parties. The two will also try to maximise stakeholder recoveries, implying that former FTX customers will be compensated.
The parties have agreed to inventory crypto assets currently held in a Fireblocks wallet by securities regulators in the Bahamas.
Both parties are said to be pleased with the Bahamas Securities Commission’s protection of those assets. The issue has been hotly debated since December 29, when the Bahamas Securities Commission admitted to holding $3.5 billion in cryptocurrency. FTX also claimed that regulators took $300 million without authority.
The two parties have also agreed to sell real estate in the Bahamas. It is unclear whether this section of the agreement refers to FTX’s business offices or the contentious condominiums in which FTX executives resided.
The agreement is awaiting approval in two jurisdictions: the United States Bankruptcy Court in Delaware, which is handling the bankruptcy proceedings of FTX Trading Ltd., and the Supreme Court of The Bahamas, which is handling the liquidation of FTX Digital Markets.
Criminal proceedings are also underway in the Southern District of New York against former FTX CEO Sam Bankman-Fried and his associates.
