FTX to Begin Creditor Payouts on May 30 After Nearly Three-Year Bankruptcy Ordeal
Nearly three years after its dramatic collapse, cryptocurrency exchange FTX is preparing to begin repaying its largest creditors, with the first round of payments scheduled for May 30, according to court proceedings in Delaware cited by Bloomberg.
The defunct exchange, once led by Sam Bankman-Fried, has amassed $11.4 billion in cash to distribute to thousands of affected parties. These payouts will primarily go to institutional investors and companies that held assets on the platform at the time of its 2022 bankruptcy.
Smaller creditors—those with claims under $50,000—have already begun to receive partial repayments as part of an earlier distribution phase.
FTX’s downfall left a massive hole in the crypto industry, triggering widespread financial damage and disappointment. Many creditors had hoped to be repaid in cryptocurrency, particularly as bitcoin’s value has more than quadrupled since the platform went under, making dollar-based reimbursements far less appealing.
The bankruptcy process has been prolonged by a flood of claims, some of which are suspected to be duplicates or outright fraud. According to FTX’s bankruptcy attorney Andrew Dietderich, the company has received claims totaling a staggering “27 quintillion” dollars—an amount clearly inflated due to faulty or illegitimate filings.
Adding to the pressure is the accumulating interest on valid claims. While FTX’s cash reserves generate only minimal returns, approved creditors are legally entitled to 9% annual interest on unpaid balances. The longer the delay, the greater the liability for the estate.
