FTX repayments: Creditors can hope for $16 billion!

FTX, the now insolvent crypto platform, has announced the first repayment dates for creditors. Insolvency administrator Andrew Dietderich stated before a US court that repayments to institutional investors and major creditors should begin on May 30, 2025. In total, FTX plans to allocate around $11.4 billion to cover compensation due.

Small investors with so-called “convenience claims,” i.e. claims under $50,000, have been benefiting from repayments since January. For these creditors, the repayment is 100% of their claim plus 9% interest. A total of $16 billion is expected to be repaid to users, which is considered a significant step after three years of uncertainty since bankruptcy in November 2022. FTX’s collapse was due to a severe liquidity crisis.

Details about the repayment process

Repayments to creditors processed through BitGo, a digital asset management provider, may appear as pending transactions in creditors' accounts up to ten days before the final payout date. FTX will additionally continue to review approximately 27 trillion individual claims, many of which are incorrect or invalid. Interest claims from creditors increase by around nine percent annually, while FTX assets hardly generate any interest.

US Senator Elizabeth Warren expressed criticism of SEC nominee Paul Atkins due to his previous advisory work for FTX. At the same time, former CEO Sam Bankman-Fried was sentenced to 25 years in prison for his role in the company and transferred to a new correctional facility. It remains unclear whether he will receive a presidential pardon.

The insolvency proceedings are nearing their end with the announced payout dates, but have not yet been completed finance.net and coin-update.de report.