Nearly three years after its spectacular collapse, FTX is reaching a pivotal moment in its bankruptcy proceedings. On May 30, the fallen exchange will distribute over $5 billion to its creditors, providing partial yet significant relief to victims of one of the biggest cryptocurrency disasters in history.
The FTX Recovery Trust has announced that the second phase of repayment to creditors of the bankrupt cryptocurrency exchange platform will commence on May 30, 2025. With a fund exceeding $5 billion, this distribution marks a significant step towards resolving one of the largest bankruptcies in the history of cryptocurrencies.
According to official information, ordinary creditors and digital asset loan applicants will receive approximately 61% of their initial claims. This recovery rate, though partial, far exceeds the initial predictions made after the collapse of FTX in November 2022.
This success is part of the reorganization plan under Chapter 11 of the US bankruptcy law. Under the oversight of John Ray III, who succeeded Sam Bankman-Fried as the head of FTX, the trust has reclaimed assets well beyond expectations, notably due to the cryptocurrency price surge since 2022.
For the thousands of clients and creditors whose funds have been locked for over two years, this distribution represents a major milestone:
However, not all creditors will receive the same treatment. Repayment percentages may vary based on the defined categories in the bankruptcy proceedings.
The injection of $5 billion into the crypto ecosystem could have significant effects:
The FTX case remains a stark reminder of the importance of transparency, governance, and regulation in the cryptocurrency industry. Since the platform’s downfall, many exchanges have adopted stronger practices, such as verifiable reserves and increased transparency.
Sam Bankman-Fried, former CEO of FTX, is currently serving a prison sentence after being convicted of fraud and other offenses related to managing FTX and its affiliate, Alameda Research.
Eligible creditors have been informed of the steps to receive their repayments. Those who have not completed the KYC (Know Your Customer) procedures are advised to do so promptly to avoid any delays.
This May 30, 2025, distribution is just one step in a repayment process that could span several years until the complete distribution of recoverable assets.
Charles Ledoux is a Bitcoin and blockchain technology specialist. A graduate of the Crypto Academy, he has been a Bitcoin miner for over a year. He has written numerous masterclasses to educate newcomers to the industry and has authored over 2,000 articles on cryptocurrency. Now, he aims to share his passion for crypto through his articles for InvestX.
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