FTX, a popular cryptocurrency exchange, seemed to tease a potential reopening on Wednesday as lawyers representing the company told a U.S. Bankruptcy Court they are planning to file a reorganization plan in July of this year that could lead to a confirmation sometime in the second quarter of the following year. Currently, the exchange has gathered assets worth a total of $7.3 billion. In November of last year, customers began withdrawing funds from the exchange and the company was eventually forced to declare bankruptcy protection. The idea of an eventual restart was first proposed by the company's chief executive officer, John Ray III, early this January and various “reboot of exchange” meetings were organized by lawyers representing FTX's creditors. Prior to this, Zane Tackett (former head of institutional sales at FTX) told The Block that the company should relaunch and offer trading in FTX bankruptcy claims.

The remarks of Andy Dietderich of Sullivan & Cromwell appear to be the first real indication of an eventual relaunch, although he noted that it would still require a good deal of capital, or in alternative, the use of the exchange's remaining funds. The target plan timeline presented in court puts forward that an initial plan would be presented in the third quarter of this year. Former CTO Gary Wang (who has recently pleaded guilty to criminal charges) is providing material assistance to FTX's debtors in an effort to locate more assets.

Furthermore, the FTX founder, Sam Bankman-Fried, was accused of having consistently lied to stakeholders, customers, and creditors in order to maintain a false digital front. In his own words, Dietderich described the exchange platform as a "video game" and a "facade", at a time when it actually only presented a rapid response and convenience in comparison with competitors. Bankman-Fried attempted to access an insurance policy worth $10 million in order to cover his legal bills, however his motion was rejected by Judge John Dorsey of the U.S. Bankruptcy Court for the District of Delaware as there was no evidence or established cause to back his claims. Bankman-Fried can still come back with more information at a later point.

It appears the future of FTX exchanges remains uncertain, although there is still hope. A potential reopening with the collection of $7.3 billion in assets could be a huge boon to the sector, but the chances of this have yet to be determined. Lawyers representing the exchange have to finish all the paperwork by July and then await a decision in the second quarter of 2022, which could either make or break the future of FTX.



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