FTX will start repaying its creditors on February 18, 2025, that is today, beginning with those in the “Convenience Class”—creditors with claims of $50,000 or less. These individuals will receive full repayment and 9% annual interest accrued since November 2022.
Payments will be processed through BitGo and Kraken, with funds expected to reach eligible creditors within one to three business days after the distribution starts.
Who Qualifies for Repayments?
Creditors must complete Know Your Customer (KYC) verification to receive their funds and submit necessary tax documents. Those who fail to meet these requirements by the deadline will be excluded from the initial distribution but may still qualify for future payments once their issues are resolved.
Creditors with claims exceeding $50,000 will have to wait longer, as their payments are scheduled for Q2 2025. In total, FTX plans to distribute $17 billion, with $7 billion set for the first phase of repayments.
FTX’s Bankruptcy and Asset Recovery
FTX’s repayment plan is a crucial step in its reorganization, which officially took effect on January 3, 2025, following extensive bankruptcy proceedings and asset recovery efforts.
The exchange collapsed in late 2022 due to a liquidity crisis, leaving creditors and investors in financial distress.
The downfall of FTX also led to severe legal consequences for its leadership. Former CEO Sam Bankman-Fried was sentenced to 25 years in prison for fraud and mismanagement.
Several other executives from the company have also faced legal action for their roles in the exchange’s collapse.
Market Impact and FTT Token Movement
While most repayments will be made in cash, some creditors may receive payouts in cryptocurrency. If a large number of recipients choose to sell their crypto holdings, it could create selling pressure in the market.
Meanwhile, the FTT token, which was once central to the FTX ecosystem, has seen an increase in trading activity. The token is currently priced at $2.18, with a 24-hour trading volume surge of 51.59%.
Adding to the activity, a wallet linked to FTX recently moved 0.3 Bitcoin (worth approximately $29,000) in three separate transactions, according to Arkham Intelligence.Â
FTX’s repayment plan marks a significant moment for creditors who have been waiting for their money since the exchange’s collapse. The process will be closely monitored as the company moves forward with its bankruptcy resolutions. For many, the February 18 payout will be the first real sign of financial recovery after more than two years of uncertainty.
Also Read: President Trump Appoints Former FTX Prosecutor Danielle Sassoon As Interim Manhattan U.S. Attorney