FTX Lawyers and Creditors Clash Over Bankrupt Estate's Proposed Reorganization Plan

Let's go to FCX plan and talk about bigger problems. This is a tough one. Creditors and debtors are fighting it out after a draft reorganization plan was filed by John J Ray the third, the new CEO of FTX and FTX Estate, of course, are going through this Chapter 11 process, which is going to be drawn out for quite some time. They've been at it for well over six months at this point and they've been racking up a lot of fees. The creditors here are not super happy with the handling of a lot of different aspects of the estate. Uh for one point they even issued that, hey, why is the treasury not being uh put into us T bills so we can earn a yield on top of all the money that is waiting to be distributed to FTX creditors. Uh Estate has some thoughts about that. There's some back and forth here at the end of the day. I think it's just two groups arguing over a vast sum of money that is owed from one party to another. This is a story as time as all the time itself, right? Like Chapter 11 back and forth, Jen. I gotta throw it to you. What's your take on this one? I'm imagining when I read the story, I imagine ftxs New management, like in suits, you know, all the lawyers that are making all that money that we spoke about way back when trying to talk to like a bunch of D GS who won't turn their Zoom cameras on and just getting absolutely frustrated. There are some real great nuggets in here if you read the footnotes and the whole, the whole thing. But I think it makes sense like FT X's management needs to be conservative. They need to look at this whole thing. Holistic. I think this is one group, it's the group of unsecured creditors who are saying no, you need to do Xy and Z I think they're, I think they were suggesting, uh putting some of the money into long term crypto holdings or talking about us treasury bonds and, you know, I think that's a little bit risky when you're looking at getting as much money as possible back to all of the people who are owed money in this. Uh, there's a lot to dive into here but Zach, I want to get you in first before we, we dive down that rabbit hole. Yeah, I do like the part where it's just like we're gonna put it all on red and we are going to get it back in one. Let's do this thing. Yeah. Yeah. Yeah, it's like that meme, it's like that like, I don't know, I forget which movie it is but the Las Vegas meme where everyone's like, gathered around the craps table, like various disfigured, uh, injuries. And you, you often see various sort of crypto figureheads placed into that meme. And you can imagine the DG on the creditor's side being like, yes, we can do it this way. But really, it's just, just a tug of war between two parties seeking to establish power of these proceedings, right? I think this is very much in response. This is kind of John J Ray kind of clapping back and saying, hey, creditors like pipe down, I know you said this thing where you want control over who's making these decisions. I think that was the previous week that the creditors committee came out and cast a little shade on uh how the estate is handling things. And hey JJ Ray the third is gonna clap back. But if we know anything, this man does not mess around, we've seen this guy come out firing time and time again. He he's he's ready to roll up his sleeves and put the fist of Coffs up on this one. So interesting to see again the world of where it's escalated between these parties who um you know, see different priorities and how uh this should be handled and this is uh some tension sort of spilling out into the public sphere. Will. What do you think? Three bits and pieces here? Maybe it's context, maybe it's just kind of like fun facts. So I just want to bring up one. There's this debate over should FTX Reboot, FTX 2.0 as it were John G Ray the third and the FDX estate has hinted at it and maybe even like suggested that they might move forward with it. There's certainly a lot of creditors and debtors who want this to occur because they think this is possibly the only way for them to see more of their money. Uh Typically in chapter 11, we see like maybe like 11 cents on the dollar get paid out eventually. I mean, Mount Gox Celsius, there's so many different stories uh in the past where we haven't really seen the money go back. Uh Completely, another few thoughts on this is one the debtors have issued in this note, a complaint that they not met with the estate at all. And it seems to be some frustration there because the FDX estate is spending so much like millions of dollars like that. The hourly cost for these things is incredible yet they're unwilling to meet with the debtors in this situation. Uh, which strikes me as a little bit odd, but maybe they just don't want to deal with it. And I suppose if I was in a situation making a lot of money, I wouldn't answer the phone either. I don't know Jen, I have to add this ti tidbit in. They are, I guess looking for solutions if we want to get the uncredited um the unsecured creditors, some um some points here. They, the reason that they were suggesting that FTX look into short term treasuries was to help offset that $330 million legal fee bill that we spoke about on the show. I think it was months ago now. So they are coming with solutions. You gotta give them some credit there, Zach, I'm gonna hand it off to you for last words, this story will never die. This is the story that will never die. Maybe we can talk about it 10 years from now if we're lucky. Oh, wow. It's kind of like all the other FDX stories too, right? Where there's like got new information about Ellison or Sam or whatever. It's like two different tracks for the same story. Yeah, you gotta have, you know, like the, you got the A storyline and the B storyline, you got the, the suits sparring over various procedural juice and then you, you got the juice over here. You got the, you got the Machiavellian and you got the, the personal drama. You got all sorts of stuff, all sorts of stuff. Maybe, maybe when Netflix finally makes the documentary, they'll use a clip from the hashh That is my dream. We have been in a book about this. We have been in a book about this. Yes. Shout out to Brady Dale. Now with axios, go get that book.