Gate Initiates Second Distribution to Creditors: Bitcoin Payments Valued at $95,000 Each

In a significant development for the cryptocurrency lending industry, Gate has launched its second round of distributions to creditors, totaling $127 million. This follows the platform's earlier efforts to distribute roughly $3 billion in cryptocurrency and fiat currency, which began after creditors approved its reorganization plan earlier this year.

This latest distribution targets eligible creditors affected by Gate's operational challenges and subsequent restructuring process, which had temporarily suspended withdrawals prior to the reorganization efforts.

Gate Adapts Strategy for Second Distribution

Court filings reveal that the funds for this distribution were transformed from cash received from Litigation Administrators into Bitcoin (BTC) for eligible creditors with validated claims. This conversion was implemented to enhance the efficiency of the distribution process and reduce administrative complexities.

Eligible creditors are set to receive a cumulative distribution representing approximately 60.4% of their claims' value as of the petition date. The BTC allocated for this distribution is based on a weighted average price of $95,836.23, reflecting the rate at which Gate acquired the cryptocurrency for this specific purpose.

The distribution mechanism is structured to ensure creditors receive their allocated amounts in either cash or readily tradable cryptocurrency. In cases where a creditor was scheduled to receive a distribution via a designated cryptocurrency exchange but did not receive it by the specified date, Gate will continue to hold the liquid crypto for that creditor and convert it to cash when deemed appropriate.

Navigating Restructuring Complexities

Interestingly, the documents indicate that some creditors received initial distributions based on different recovery rates—57.87% for some and 57.65% for others. To address this disparity, those who received a higher initial distribution will see a proportional reduction in their second distribution.

Gate encourages eligible creditors to verify and update their distribution information, particularly if they need to modify their distribution agent. Creditors experiencing issues with receiving their funds can initiate a Customer Care Ticket for assistance.

Beyond this distribution, Gate affirms its commitment to addressing the intricacies of its restructuring process, which includes ongoing legal proceedings that may impact certain creditors' eligibility for distributions.

As of the latest update, the platform's native token is trading at $0.23, showing a marginal increase of 1% over the past 24 hours. Notably, this token stands out as one of the few digital assets that hasn't experienced a significant upward trend in recent weeks.

While the token's year-to-date performance shows a 2% decline, a more concerning aspect emerges when comparing its current trading level to its historical peak. There remains a substantial 97% gap between its current price and its all-time high of $8, achieved in June 2021 before the platform encountered operational challenges.