Key Points
- FTX’s repayments are pegged to November 2022 crypto prices.
- However, since November 2022, Bitcoin prices surged by about 5-6x.
According to the latest reports, FTX will start its around $16 billion creditor repayments on February 18. The first phase involves repayments between $6.5 billion and $7 billion, and the payouts are reportedly based on November 22 prices.
FTX official notes
However, since November 2022, when BTC was trading above $16,000, the digital asset surged by around 6 times, judging from the current prices above $98,000, which means that creditors will be paid less, considering that the market has moved up.
On the other hand, the fact that FTX offered creditors a specific date for repayment debut is a start, according to some X users .
FTX Announced Progress in Chapter 11 Plan of Reorganization in November
In November 2024, FTX announced important progress in finalizing the steps required to activate its Chapter 11 Plan of Reorganization.
This marked a key milestone in FTX’s ongoing bankruptcy proceedings which paved the way for creditor and customer distributions starting this year.
Back then, John J. Ray III, Chief Executive Officer and Chief Restructuring Officer for FTX said that the team was pleased to announce that they would begin redistributing funds in 2025.
FTX Funds Distribution Timeline
He said that the timeline reflected the dedication of the team and the progress made in recovering billions of dollars on behalf of creditors and customers.
He also highlighted that they were committed to ensuring distributions would take place as quickly as possible.
In early December 2024, FTX finalized agreements with specialized distribution agents who manage global recoveries. At the end of December last year, the court was expected to approve the Disputed Claims Reserve Amount and in January 2025, the plan became effective.
Customer Requirements
As we also noted in November 2024, customers had to complete specific steps to receive distributions, including the following:
- Establish an approved account with a Distribution Agent
- Complete the KYC verification
- Submit the necessary tax documentation
The bankruptcy of FTX, the Bahamas-based crypto exchange, debuted on November 22. The collapse of FTX was triggered by a spike in customer withdrawals that exposed an $8 billion hole in FTX’s accounts.
