Users affected by FTX’s 2022 crash will begin receiving bankruptcy distributions, with the option to receive payouts in stablecoins, through Kraken and BitGo.
The FTX estate confirmed that its bankruptcy disbursement plan will become effective on January 3, 2025, following court approval by U.S. District Judge John Dorsey in October.
Sunil Kavuri, a spokesperson for FTX’s largest creditor group, identified Kraken and BitGo as the confirmed distribution partners, citing the platforms’ payment capabilities. According to Kavuri, customers will have the option to receive repayments in stablecoins.
The plan, ruled by Judge Dorsey in Delaware, approved 98% of creditors to receive 118% of their claim value in early October. FTX’s decision to repay users in cash drew criticism from Kavuri and other bankruptcy claimants.
Yet, court documents showed that 94% of creditors with claims against the crypto exchange voted “Yes” to the plan. This group comprises nearly $7 billion in claims, according to the reorganization plan.
Bankruptcy administrator John J. Ray III commended his interim team for recovering about $16 billion in assets and cash for FTX creditors. Ray took over as CEO in late 2022, replacing Sam Bankman-Fried. Companies under the FTX umbrella, such as Alameda Research, also collapsed, and several of Bankman-Fried’s top associates signed plea deals with federal prosecutors in exchange for lighter sentences.
By November 2023, Bankman-Fried was found guilty on seven charges and sentenced to 25 years in prison for fraud. Under CEO Ray’s leadership, the defunct crypto exchange has worked to reconstruct the remnants of Bankman-Fried’s one-time crypto empire.
For the past two years, our team of professionals have meticulously and efficiently worked to recover billions of dollars to reach this point. The Plan becoming effective in January 2025 and the start of distributions are reflections of the outstanding success of the recovery efforts.
John J. Ray III, FTX CEO
