FTX to begin creditor payouts on February 18, initial claims under $50K
New date for FTX creditor repayments
FTX liquidators appear ready to begin compensating creditors of the crypto exchange, which collapsed in 2022. According to an email sent to former FTX clients, repayments for lost assets will start on February 18, 2025.
Initially, payments will be made to creditors with claims under $50,000 and those registered in the Bahamas-based legal process.
"The Joint Official Liquidators of FTX are pleased to inform you that you have completed all necessary steps to receive a distribution related to your Convenience Class claim, and the payment will be made to your designated account," the email states.
According to the message, all payments in this category will be processed through crypto custody platform BitGo. Other creditor categories will start receiving payments from March 4, 2025.
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A difficult path to restoring trust
The FTX repayments are seen as a major step in rebuilding investor confidence in the crypto market. However, liquidators have repeatedly announced payout schedules in the past, only to delay them for various reasons.
The compensation model has also drawn criticism. While assets held on the exchange since November 11, 2022, accrue 9% annual interest, meaning 98% of creditors are set to receive 119% of their original claims, payouts are calculated based on 2022 asset prices.
Since then, Bitcoin prices have surged by 370%, and the value of other cryptocurrencies has also changed significantly, meaning creditors will not receive the full current market value of their crypto holdings.
As we wrote, creditors of FTX are calling for an investigation into the activities of the bankruptcy managers overseeing the crypto exchange, citing their excessive expenses.
A lawsuit filed on behalf of FTX creditor Lydia Favario highlights the need for stricter oversight of spending by legal firms managing FTX's bankruptcy process.
