Users affected by FTX’s 2022 crash will begin receiving bankruptcy distributions, with the option to receive payments in stablecoins via Kraken and BitGo.
The FTX estate confirmed that the bankruptcy settlement plan will go into effect on January 3, 2025, following court approval by U.S. District Judge John Dorsey in October.
Sunil Kavuri, a spokesman for FTX’s largest creditor group, described Kraken and BitGo as approved distribution partners, citing the platforms’ payment capabilities. According to Kavuri, customers will have the option to receive their refunds in stablecoins.
FTX Claims: Distribution
FTX has installed two distribution partners –
Bitgo and Kraken third will be coming soon
To FTX Request Portal pic.twitter.com/x48fogTQZE
— Sunil (FTX Creditor Champion) (@sunil_trades) December 16, 2024
The plan, administered by Judge Dorsey in Delaware, approved 98% of creditors in early October to receive 118% of their claim values. FTX’s decision to refund users in cash drew criticism from Kavuri and other bankruptcy plaintiffs.
However, court documents showed that 94% of creditors who filed claims against the crypto exchange voted “Yes” on the plan. According to the restructuring plan, this group consists of approximately $7 billion in claims.
Bankruptcy administrator John J. Ray III praised his interim team for recovering nearly $16 billion in assets and cash for FTX creditors. Ray takes 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 employees signed plea deals with federal prosecutors in exchange for lighter sentences.
As of November 2023, Bankman-Fried has been found guilty of seven charges and sentenced to 25 years in prison for fraud. Under CEO Ray’s leadership, the defunct crypto exchange worked to rebuild the remnants of Bankman-Fried’s one-time crypto empire.
To get to this point, our professional team has worked meticulously and efficiently over the last two years to recover billions of dollars. The plan’s entry into force and distribution start in January 2025 is a reflection of the outstanding success of the rescue efforts.
John J. Ray III, FTX CEO