FTT Surges 15% as Court Documents Confirm an FTX Reboot Plan is Underway
Sam Bankman-Fried’s doomed crypto exchange FTX will likely be restarted as FTX 2.0 by its new management as the court documents confirm that an FTX reboot plan is underway by its current CEO John Ray III. The native utility token, FTT, surged more than 15% following the news.
According to the monthly staffing and compensation report filed with the US Bankruptcy Court for the District of Delaware on Monday, May 22nd, the CEO, John Ray III, has been actively working on an FTX reboot plan called FTX 2.0 to give money back to its creditors.
FTX CEO John Ray III confirms FTX 2.0 plans. pic.twitter.com/FeCXOvdrt0
— FTX 2.0 Coalition (@AFTXcreditor) May 22, 2023
Investors are Interested in FTX Reboot
The news of FTX 2.0 got in the air in January 2023 when Ray said he had tasked a group with exploring a restart of the exchange’s international arm. In the last month of April, the exchange’s lead bankruptcy attorney from Sullivan & Cromwell again floated the possibility that the exchange could one day be reopened.
However, the excitement faded away after the attorney told the court that options were available, but they had not articulated any plan yet. There is a discussion about whether to restart FTX International or only the exchange tailored to US-based investors.
However, the court filing reveals that Ray has been actively working to formulate a plan to restart the exchange for the past few months. His activities included consultation with cybersecurity firm Sygnia to fortify the international crypto platform, exploring the next steps for restarting the crypto exchange and reviewing and finalizing the FTX 2.0 material for distribution to investors. He was constantly in touch with the investment bank Perella Weinberg Partners LP regarding the 2.0 reboot plan.
Court documents revealed some plans FTX CEO John Ray III made for FTX 2.0, including Review 2.0 next steps summary, Review next steps and comment on FTX restart, Review and finalize 2.0 reboot of exchangematerial for distribution, Revew and comment on 2.0 bidder list and more. By… pic.twitter.com/zjjmFZ7wDG
— Wu Blockchain (@WuBlockchain) May 23, 2023
There were also discussions about the issue of raising capital to restart the doomed crypto exchange. The management was brainstorming whether the bankruptcy estate should use its funds or seek capital from third parties to fund the potential restart. One possibility suggested by the management involved letting FTX’s burned customers divert a portion of what they eventually get back to receive some interest in the exchange moving forward.
Monday’s filing reveals that the reboot plan has drawn interest from some third parties, as John Ray III had reviewed a list of bidders for FTX 2.0. Bloomberg reported last month that Tribe Capital, a venture firm that invested in both international and US arms of FTX, had expressed interest in restarting the bankrupt crypto exchange.
The management is still to finalize a plan, and the realization of FTX 2.0 seems months away. Still, this positive development was enough to surge the FTX native token FTT by more than 15%, from around $1.00 to a 24-hour high of $1.16 before eventually settling back to $1.10 as of writing.
The community welcomed the FTX 2.0 plan as they believe it is the only they can get their money back. The hashtag FTX 2.0 is trending on Twitter as of writing.
ftx 2.0 is probably the only shot ftx creditors (me) have at seeing any money, so would be big if true. I actually think it could be surprisingly succesful too. https://t.co/fcjVNFfBeB
— Scoob (@PonziScoob) May 22, 2023