FTX Sets March 2025 Timeline for $16 Billion Creditor Repayment Following Reorganization Plan
The defunct cryptocurrency exchange FTX has announced a concrete timeline for creditor reimbursements, marking a significant milestone in its bankruptcy proceedings. The company plans to begin distributing approximately $16 billion to former customers and creditors by March 2025, following the implementation of its court-approved Chapter 11 Plan of Reorganization in January.
John J. Ray III, FTX’s Chief Executive Officer and Chief Restructuring Officer, expressed optimism about the development. “We are pleased to announce that we will begin distributing proceeds in early 2025,” he stated. “While we continue to take actions to maximize recoveries, we are full steam ahead to reach arrangements with our distribution agents and return proceeds to creditors and customers as quickly as possible.”
The distribution process will unfold in several key stages. In early December, FTX will finalize arrangements with specialized distribution agents who will manage the global payout process. By the end of December, the company expects to announce the exact effective date following a court order approving the Disputed Claims Reserve Amount.
For creditors to receive payments in the initial distribution phase, they must complete several prerequisites. These include establishing an approved account with a distribution agent, completing KYC verification, and submitting required tax forms before the distribution record date. The company has also issued a special notice to claims traders, warning that transactions made within 45 days of the distribution record date may result in payments being directed to the original claim holder.
The reorganization plan, which received support from approximately 96% of creditors, represents one of the most comprehensive repayment proposals in recent bankruptcy proceedings. However, some creditors, including Sunil Kavuri, have expressed concerns about the payment structure, which will distribute funds in USD rather than cryptocurrency.
This development comes two years after FTX’s dramatic collapse, which led to the conviction of founder Sam Bankman-Fried on fraud charges and his subsequent 25-year prison sentence. Under Ray’s leadership, the bankruptcy team has successfully recovered billions in assets through various recovery efforts and lawsuits, potentially enabling creditors to receive most, if not all, of their assets back.
The announcement signifies a crucial step toward resolution for thousands of affected customers and creditors, bringing closure to one of the most significant failures in cryptocurrency industry history.
