FTX Starts New $900 Million Payout for Creditors

FTX will begin its fifth distribution of funds to creditors on July 31. This payout adds $900 million to the recovery effort, bringing the total promised repayments to over $10 billion. Eligible creditors who completed the necessary paperwork by June 16 should see their funds arrive within three business days through platforms like BitGo, Kraken, or Payoneer.

The repayment breakdown varies by creditor class. Users of the exchange will see their cumulative recoveries increase, with some groups reaching 105% to 120% of their approved claims in dollar value. Additionally, the estate plans to distribute $18 million to preferred shareholders on the same date.

While these figures suggest total recovery, the payments are based on the dollar value of assets at the time of the bankruptcy in late 2022. Because many crypto assets have gained significant value since then, many creditors still feel the impact of the loss compared to current market prices. Investors are watching these distributions closely as they mark the final chapters of the exchange's legal saga.

Meanwhile, the political path for former CEO Sam Bankman Fried remains closed. The Senate recently voted unanimously to reject any possibility of executive clemency or a pardon for him, ensuring he remains in prison for his role in the collapse of the exchange.