Defunct cryptocurrency exchange FTX plans to distribute claims held by “convenience class” creditors on Feb. 18.
According to documents recently shared by FTX with its creditors and included in an X post by FTX Creditor Activist Sunil, the funds will be distributed on Feb. 18 and will be available from 10 AM ET. This distribution event will only include the “convenience class” creditors, comprised of those who are owed under $50,000. He wrote:
“FTX Creditors in the Bahamas process have email confirmation that repayments will start on 18 Feb 2025.”
The details
According to data shared by Sunil in a subsequent X post, creditors will see a 119% reimbursement of assets held on the platform at the time of its collapse. The total value of the funds that could be distributed is $1.2 billion, but at the time of writing, only creditors owed about $800 million had passed know-your-client checks. This means that another $800 million will be held up until holder checks are completed.
Users who chose to receive reimbursement through the crypto exchange BitGo have also reported receiving a notification asking them to control a shared wallet. The funds will later be distributed through this shared wallet.
FTX used to be a rising star of the cryptocurrency industry, with its founder, Sam Bankman-Fried, funneling millions into both Republican and Democrat candidates in an apparent attempt to influence financial policymaking. Due to unsavory capital management and trading with customer funds, the firm lost billions and went bankrupt.
Still, due to a rise in crypto market prices, the firm has accumulated billions of dollars more than necessary to cover the losses incurred during its collapse in November 2022, according to May 2024 reporting. FTX restructuring CEO John Ray noted at the time that the company is expected to have approximately $16.3 billion in cash, surpassing its $11 billion debt to customers and other non-governmental creditors. Ray said:
“In any bankruptcy, this is just an unbelievable result.”
