Key Street Shops
- FTX creditor refunds will begin within 60 days of January 3, 2025.
- BitGo and Kraken were appointed as distribution managers, requiring creditors to use the FTX Customer Portal for Debtors for KYC and tax submissions.
After a long and arduous process followed by a dramatic fallout, the FTX payment plan has officially gone into effect today, January 3, 2025. This is a major milestone for creditors awaiting the recovery of their assets.
The estate of FTX, which manages the bankruptcy proceedings of the collapsed crypto exchange, plans to begin repayments within 60 days of the effective date, the estate said in December.
While the estate estimates the total distribution will be between $14.7 billion and $16.5 billion, the first round of payouts will not reach that amount because it prioritizes convenience classes—those with approved claims of $50,000 or less .
These creditors are expected to receive approximately 119% of their approved claim amount, including principal and accrued interest, within 60 days. This amounts to a total of about $1.2 billion, according to the plan.
According to Sunil Kavuri, a prominent supporter of FTX creditors, creditors with claims over $50,000 will receive a share of a separate pool of $10.5 billion. The distribution timeline for this group will take longer.
Important: Distribution of FTX
3rd January 25: Date of First Record Distribution
25 Feb/March: Convenience class holders <$50k = $1.2bn (119% paid within 60 days today)> $50k = $10.5bn
Customers must complete FTX
1) KYC
2) Complete Ben’s W-8 form
3) On board for distribution… pic.twitter.com/43ZfirJNX3— Sunil (FTX Accredited Champion) (@sunil_trades) January 3, 2025
BitGo and Kraken have been appointed to manage initial distributions for retail and institutional customers in supported jurisdictions. Creditors must complete KYC verification, submit tax forms through the FTX Debtors’ Customer Portal, and select BitGo or Kraken as a distribution manager.
Analyst estimate K33 $2.4 billion may flow back into crypto markets after executing the plan.
The analysts note that credit funds received $3.9 billion of total claims, which are unlikely to reinvest in crypto assets. Additionally, 33% of the remaining claims relate to sanctioned countries, insiders or individuals who do not have KYC verification and may be able to claim funds.
