FTX has announced that the platform’s bankruptcy plan is now formally in force. Additionally, holders of accepted claims in the Convenience Classes will be registered for the first distribution.
The platform intends to make separate notifications for the registration and payment dates for other claim categories.
Repayment Conditions: What Has FTX Mentioned?
As per FTX’s official announcement, customers and other creditors must fulfill the pre-distribution requirements, which include choosing a distribution agent on the FTX Debtors’ Customer Portal page, in order to be eligible to receive a distribution.
Additionally, FTX reminded customers to be cautious of scam websites from channels that might mimic the FTX Debtors’ Customer Portal and phishing emails that might appear from FTX Debtors.
Read Also: Celsius Seeks Reversal of Court Ruling That Denied Its $444M Claim in FTX Lawsuit
What Was The FTX Collapse?
The cryptocurrency sector was negatively impacted by the rapid collapse of FTX in 2022, which fueled public skepticism and brought down cryptocurrency services that collaborated with it.
The third-biggest cryptocurrency exchange at the time, FTX was recognized as one of the major participants in the market. Its abrupt demise not only stunned the market but also rocked the crypto industry’s core, exposing serious flaws in what investors thought was a strong and promising ecosystem.
The U.S. government charged Sam Bankman-Fried and senior officials with civil and criminal offenses in December 2022 for embezzling more than $8 billion in consumer deposits.
After being found guilty on criminal charges in November 2023, Bankman-Fried was extradited to the United States from The Bahamas. Bankman-Fried was also found guilty of stealing $8 billion from customers and given a 25-year prison sentence.
Since the fall of one of the biggest names in the crypto market had created the worst bearish trends in the market, the repayment might likely keep investors in a little good spirit.
If this happens, it is likely that the confidence and trust in the crypto sector, which has been harmed due to multiple fall outs previously, will be restored.
FTX Repayment Timeline Stays In Line With Previous Announcements
The repayment timeline that FTX has taken up stays exactly in tandem with the platform’s previous announcement. The platform had previously also announced that in order to expedite the distribution process, FTX has teamed up with BitGo and Kraken to help manage payouts to creditors and customers in all supported jurisdictions.
For retail and institutional clients, the procedure will be handled by BitGo, an internationally regulated custodian since 2013, and Kraken, a well-known cryptocurrency exchange based in the United States.
Read Also: FTX/Alameda Moves $58.7M Worth of Worldcoin ($WLD) to BitGo Escrow As Bankruptcy Payout Begin