August 1, 2023 at 09:56 GMTModified date: August 1, 2023 at 09:56 GMT
August 1, 2023 at 09:56 GMT

FTX 2.0 details confirmed as new document reveals potential reboot

Plans for FTX 2.0, a relaunch of the crypto exchange, have been officially filed, roughly eight months since its bankruptcy was announced. 

FTX 2.0. Pic: Unsplash

Plans for FTX 2.0, a relaunch of the crypto exchange, have been officially filed, roughly eight months since its bankruptcy was announced. 

The court document outlined a method to organise its creditors into different groups. Former customers of have been grouped together and given an opportunity to reboot the failed cryptocurrency exchange with third party investors.

How would FTX 2.0 work?

This “Dotcom” category would have to choose to pool their assets together. This would then contribute to an “offshore exchange company”. 

Notably, the FTX 2.0 exchange would not be available in the US. This means American investors would not be able to use the rebooted platform. 

The document said: “The Debtors may decide to establish in collaboration with third party investors a new company in a jurisdiction outside of the United States to operate a “rebooted” offshore platform… or enter into a merger or similar transaction.”

Customers of FTX “reserve the right” to not go ahead with this relaunch, especially if it delays other parts of the exchange’s post-bankruptcy plan to make good with investors. Other reasons listed on the document include “regulatory concerns” and failure to be an effective use of value for FTX customers. 

This group of debtors would not receive any compensation if they choose to go ahead with this relaunch. Instead, the investors would get a share of the relaunched FTX 2.0 exchange.

John Ray’s plan for FTX 2.0

New CEO and Chief Restructuring Officer John Ray was brought in after the collapse of FTX, as Sam Bankman Fried announced he was stepping down. In a press release, Ray said he was pleased to reveal this relaunch plan at a “relatively early stage”.

“This is expected to facilitate creditor feedback to further discuss open issues in the Plan with stakeholders, including the unsecured creditors committee, the ad hoc committee of non-U.S. customers and other parties with whom we have been in discussion.”

Ray confirmed that FTX would continue to work through the details over the third quarter of 2023. An “amended plan and a disclosure statement” will be filed by the end of the year.

FTT token

The exchange’s native FTT cryptocurrency has seen a slight climb in the 24 hours following this news. It saw a monumental crash during the fallout from the FTX scandal, from the $25 mark to below a dollar.

As of 1 August 2023, FTT was trading at $1.45, up 7% in the past day. 

However, it has been noted that FTT will not receive anything in this proposed plan. The court document said holders of the exchange token won’t get any distribution of assets. “All FTT Claims shall be cancelled, released, and extinguished.”

FTX’s reboot history 

Plans to relaunch the defunct exchange have been rumoured over the previous few months. It started after a billings document from Ray was filed in May that implied a relaunch of FTX. 

Expenses on the billing document included: 

  • “Review next steps and comment on FTX restart”
  • “Review and finalize 2.0 reboot of exchange material for distribution”
  • “Review 2.0 next steps summary from PWP”

The Wall Street Journal then reported FTX reboot talks the following month. Sources told the publication that previous exchange customers would be offered a stake in FTX 2.0. Rebranding would also be a part of its relaunch. 

A US version of the relaunch was not confirmed by sources, which is in line with the recent court document. 

Similarly, the FTT token rallied in the wake of this news. It climbed above the $2 barrier to a high of $2.42 on 30 June 2023.