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FTX Trading Ltd. and the FTX Recovery Trust have commenced initial distributions to creditors, marking the first major round of repayments since the exchange filed for bankruptcy in 2022.
The first batch of payments is being made to holders of allowed claims in FTX’s Convenience Class (<$50,000), with funds expected to be received within 1-3 business days, FTX Recovery Trust said in a statement on Tuesday.
FTX also announced that the next distribution record date is set for April 11, 2025, with payments scheduled to commence on May 30. This second round will cover Class 5 Customer Entitlement Claims, Class 6 General Unsecured Claims, and additional Convenience Claims that have been allowed since the initial record date.
“We are pleased to commence initial distributions today and set the timeline for our next distribution,” said John J. Ray III, Plan Administrator of the FTX Recovery Trust. “FTX appreciates our customers and creditors’ patience and collaboration throughout this complicated process. Our work is not over—we intend to continue our recovery efforts and returning funds to additional claim classes.”
The initial round of payments, totaling approximately $1.2 billion, is being facilitated through distribution service providers BitGo and Kraken. Creditors must complete Know Your Customer (KYC) verification, submit tax forms, and onboard with one of these platforms to receive their funds.
With over $16 billion expected to be repaid to creditors, speculation is building around how these funds will flow back into the market. While the majority of repayments will be in cash, some analysts believe a portion could re-enter the crypto ecosystem, potentially fueling buying pressure. Analysts are currently watching for any shifts in liquidity as creditors receive their payouts. Bitcoin is currently trading at $95,200, down 0.85% in the past 24 hours, per Coinmarketcap data.
The FTX collapse, which saw $8-10 billion in customer funds misused by the exchange and its sister company, Alameda Research, remains one of the largest scandals in crypto history.
