Cryptocurrency exchange FTX, which filed for bankruptcy in November 2022 following a collapse marred by fraud, has announced a repayment plan for its creditors that has sparked controversy within the crypto community.

Under the proposed plan unveiled on May 7, FTX intends to repay customers their holdings plus interest, but not in the form of cryptocurrency. Instead, creditors will receive US dollars based on the value of their accounts at the time of FTX's collapse, with the payout amounting to up to 118% of the value of their FTX accounts as of November 2022, compensating for the time value of their investments.

The repayment plan involves raising between $14.5 billion and $16.3 billion from selling off assets, including cryptocurrency held by the platform, proprietary investments held by Alameda or FTX Ventures businesses, and litigation claims. Notably, FTX's 8% stake in AI startup Anthropic, sold to institutional investors for $884 million in March, is among the assets earmarked for monetization.

While FTX asserts that the proposed plan will enable creditors to receive 100% of what they're owed, along with interest, discontent among creditors is palpable. Critics argue that the plan deprives users of the opportunity to reclaim their cryptocurrencies, which they may have held for investment or speculative purposes.

The controversy surrounding FTX's repayment plan highlights the complexities and challenges associated with navigating the aftermath of crypto exchange collapses. As stakeholders closely monitor developments, the outcome of FTX's proposed repayment scheme will likely have significant implications for future regulatory considerations and investor confidence in the crypto space.