Confirmation of plans to restart the bankrupt FTX cryptocurrency exchange has been filed with the United States Bankruptcy Court for the District of Delaware on Monday, as part of a staffing and compensation report.
The report reveals that the acting CEO, John J. Ray III, spent several hours in April devising a revival plan for the struggling exchange. Plans for a possible reboot of FTX were first announced by Ray in January and the exchange’s reorganisation plan is expected to involve a bidding process. While some in the crypto community believe FTX 2.0 could lead to a better recovery for all involved parties, others have doubts about the plan’s viability, citing issues with the exchange’s latency, API and coding difficulties.
Plans for FTX 2.0 in the Works
The CEO first disclosed that reviving FTX was on the table in January, two months after the exchange collapsed due to a severe liquidity crunch. Ray, whose duty is ensuring that FTX’s creditors receive as much compensation as possible, noted that he would consider rebooting or liquidating the exchange’s assets, which would generate more value.
Last month, after FTX recovered roughly $7.3 billion in distributable assets, the exchange’s attorney Andy Dietderich revealed that the legal team would discuss subsequent steps for a potential reboot and plans to file a preliminary reorganization plan in July. He added that confirmation of the plan would likely take place in Q2 2024.
A few days later, reports emerged that San Francisco-based venture capital firm Tribe Capital was considering a $250 million fundraising campaign to help FTX restart its operations. Tribe reportedly intends to lead the round with $100 million from itself and limited partners. The firm’s CEO, Arjun Sethi, has already met with FTX’s committee of unsecured creditors to discuss the arrangement.
