NASSAU, BAHAMAS- FTX, the bankrupt cryptocurrency exchange, has announced plans to begin distributing payments to creditors and customers in early 2025, following the approval of its Chapter 11 Plan of Reorganization, which is expected to take effect by January.
CEO John J. Ray III expressed satisfaction with the progress, stating: “We are pleased to announce that we will begin distributing proceeds in early 2025.” He highlighted the efforts of the professional team that has already recovered billions for creditors and customers.
The company has nearly completed arrangements with distribution agents, which are expected to be finalized in December. Eligible customers will be able to set up accounts through FTX’s portal after completing Know Your Customer (KYC) verification and submitting tax forms. The first round of distributions will begin within 60 days of the plan’s effective date, targeting holders in the Convenience Classes. The exact reimbursement dates and details regarding the Disputed Claims Reserve Amount will be announced once court approval is obtained.
US Bankruptcy Judge John Dorsey approved the $16.5 billion recovery plan in October. FTX estimates liquidations of its cryptocurrency holdings and other investments will yield between $14.5 billion and $16.3 billion, sufficient to cover the $11 billion owed to non-government creditors. Reimbursements will reflect the cash value of customer crypto assets as of November 2022, when the exchange collapsed following mismanagement by founder Sam Bankman-Fried and other executives. The collapse left approximately nine million customers and investors facing significant losses.
FTX has emphasized the importance of meeting all requirements before the distribution record date to qualify for the initial payout. Claims traders were cautioned that transfers made within 45 days of the record date might not be reflected, potentially redirecting payments to the original claim holders.
FTX was headquartered in The Bahamas before its collapse. Its co-founder and CEO, Sam Bankman-Fried, was arrested and extradited from The Bahamas in December 2022. Bankman-Fried has since been found guilty of defrauding customers and lenders and was sentenced to 25 years in prison.
