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FTX Debtors Revise Settlement Proposal After Objection From U.S. Trustee
The latest proposal will see the debtors include the U.S. Trustee as a noticed party and reduce the maximum settled value for claims from the earlier $10 million to $7 million.
Updated Aug 21, 2023, 3:12 p.m. Published Aug 21, 2023, 6:23 a.m.
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Bankrupt crypto exchange FTX has revised its motion for settlement after the U.S. Trustee objected to an earlier motion, according to a court filing Sunday.
Despite criticizing the U.S. Trustee as the "sole objector to the Motion" seeking to "inject itself into a routine settlement process that is already adequately safeguarded by two different creditor committees," the FTX debtors said they were proposing revisions in an effort to address the concerns.
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The latest proposal will see the debtors include the U.S. Trustee as a noticed party and reduce the maximum settled value for claims covered by the procedures from the earlier $10 million to $7 million. Debtors will also file monthly reports of executed settlements. Any objections from the "noticed parties" would need to be resolved or settled through an order of the court before the claim process can go through.
The two creditor committees are the Official Committee of Unsecured Creditors and the ad hoc committee of international customers.
The U.S. Trustee had objected to the earlier motion saying $10 million is far too high to constitute a “small” claim without even providing adequate notice as to the nature of the claims.
FTX, formerly the world's third largest digital assets exchange, went bankrupt in November last year.
Read More: FTX Fires Back at Creditors 'Willing to Gamble Estate Assets on Higher Returns'
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WH advisor Patrick Witt: Davos 2026 was ‘turning point’ for global crypto normalization
White House crypto advisor Patrick Witt said stablecoins are the “gateway drug” for global finance and that Washington is racing to deliver regulatory clarity.
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The Context: The Executive Director of the President’s Council for Advisors for Digital Assets sat down for an interview with CoinDesk where he said the recent World Economic Forum in Davos served as a stage for the Trump administration to signal its commitment to normalizing digital assets as a permanent asset class. He said:
- The administration aims to strike a balance between traditional financial incumbents and new crypto entrants through a "symbiosis" where they can coexist and compete.
- Consumers benefit from this competition, positioning the current administration as firmly on the side of technological innovation.
- The President renewed a pledge at the event to establish the United States as the undisputed "crypto capital of the world".
Latest Developments: Regulatory movement is accelerating in Washington with key committee markups scheduled for major digital asset legislation.
- The Senate Agriculture Committee is set to mark up its portion of the market structure bill on Thursday, January 29th at 10:30 AM.
- The Senate Banking Committee has postponed its markup, requiring further mediation on issues like stablecoin rewards and ethics.
- Witt expressed confidence that despite these delays, the legislation will eventually be reconciled and brought to the Senate floor.
Reading Between the Lines: Stablecoins are acting as a "gateway drug" for global business leaders who are beginning to grasp the technology's potential—and its threat.
- Witt observed a cycle where traditional players move from a lack of understanding to fear, and finally to incorporating crypto into their own product offerings.
- While some Senate Republicans worry about stablecoins causing deposit flight from community banks, Witt believes a "smooth glide path" into these future technologies is possible with patience and cooperation.
- “Consumers win when there’s choice,” he said, while also acknowledging concerns from Senate Republicans about community banks and financial stability. The administration, he suggested, sees convergence between crypto and traditional finance as inevitable but wants the transition to be smooth rather than destabilizing to all parties.
- U.S. regulators intend to lead the global regulatory conversation, even if the domestic legislative process results in imperfect "directionally accurate" rules.
What Comes Next: Once the primary market structure bill passes, the administration plans to pivot toward a major crypto tax package.
- Witt suggested there is still a window of opportunity to pass additional digital asset legislation this year before midterms dominate the congressional calendar.
- The administration is also monitoring "developing situations" regarding digital assets potentially seized in national security actions abroad, such as in Venezuela.
- Finally, Witt declined to specifically comment on speculation that Venezuelan enforcement actions may have involved seized digital assets, citing national security sensitivities and an evolving situation, but did add, “There’s a number of folks in the national security apparatus engaged,” in regards to how the Maduro regime was financed.
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