Key Highlights:

• 94% of creditors voted in favor of the plan, but many wanted their crypto back, not cash. Could this be the beginning of a tax nightmare for investors?
• The hope for FTX 2.0 has fizzled out, with no investors willing to commit to a reboot of the once-dominant exchange.

Yello Paradisers! Is your crypto payout about to disappear in a puff of dollar bills? After two years of financial chaos, the court has spoken, but not everyone’s thrilled with the solution. Are we witnessing the end of an era or the start of another FTX drama?

FTX Reorganization Plan Approved, But Criticism Mounts Over Dollar Payouts

In a landmark decision that has left creditors with mixed emotions, a U.S. bankruptcy judge has given the green light to FTX’s reorganization plan. After months of legal battles following the collapse of the exchange, 98% of creditors are set to receive at least 118% of their claim value. Sounds like a win, right? Not so fast, many creditors, like the ever-vocal Sunil Kavuri, are fuming over the decision to pay out in dollars rather than the cryptocurrencies they originally held. Ouch.

Despite Kavuri’s protests and warnings of steep tax bills for those forced into dollar payouts, the court made it clear: the crypto FTX customers thought they owned doesn’t exist anymore. The FTX estate confirmed they simply don’t have the coins to return to customers “in-kind,” leaving some with the harsh reality of accepting fiat in place of their beloved crypto.

With Sam Bankman-Fried behind bars for nearly 25 years and his former partners facing their own reckonings, this ruling brings some closure—but not without controversy. If you were hoping for a crypto payout, prepare for some heated debates and (potentially) a tax headache instead!