SEC Challenges FTX’s Reorganization Plan
The SEC has taken a stand against FTX's bankruptcy reorganization plan, signaling a potential legal dispute.
Despite FTX’s claim of strong creditor support, the SEC filed a notice on August 30 expressing serious concerns about the plan.
The SEC’s objections center on the inclusion of a discharge provision, which it wants removed. Additionally, the SEC is demanding other adjustments to the plan. Failure to address these concerns may lead the SEC to oppose the plan’s confirmation.
This development echoes criticism from Andrew R. Vara, the U.S. Trustee for the case, who argues that the plan provides overly broad legal protections to FTX’s administrators and advisors. Vara believes such protections are excessive given the existing court oversight of these roles.
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The SEC is also scrutinizing how FTX handles its crypto assets during the bankruptcy. Although the SEC hasn’t detailed its stance on whether these transactions adhere to securities laws, it has indicated that further challenges may arise.
This intervention reflects the SEC’s ongoing regulatory stance under Chairman Gary Gensler, who has been actively classifying various cryptocurrencies as securities, impacting major players like Coinbase and Binance.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
