FTX to Repay Creditors $11.4B by May 2025: A Landmark Bankruptcy Payout

The bankrupt cryptocurrency exchange FTX has confirmed plans to repay its main creditors by May 30, 2025, marking one of the largest insolvency payouts in financial history. According to Bloomberg, the repayment will be made in cash, totaling $11.4 billion, drawn from the exchange’s reclaimed assets.

FTX’s Bankruptcy and Asset Recovery

FTX filed for Chapter 11 bankruptcy in November 2022 after founder Sam Bankman-Fried (SBF) was exposed for misappropriating client funds to cover losses at his hedge fund, Alameda Research. The collapse left over 1 million creditors trapped in one of the most notorious financial scandals in crypto history.

Since then, CEO John J. Ray III, known for overseeing Enron’s liquidation, has successfully recovered between $14.7 billion and $16.5 billion in assets. These include tech investments, real estate holdings, and digital assets, which benefited from Bitcoin’s surge in value.

FTX Creditors to Receive 119% Repayment

A court-approved restructuring plan, ratified in October 2024, ensures that creditors will receive 119% of their claims, an exceptional outcome in bankruptcy cases.

Smaller creditors with claims under $50,000 have already started receiving payments, with 98% of minor creditors expected to be fully compensated within two months of the repayment plan’s activation.

However, not all creditors are satisfied. Some have pushed for crypto-based repayments, citing Bitcoin’s substantial gains since 2022. However, U.S. Bankruptcy Judge John Dorsey has ruled that all reimbursements must be in cash, based on 2022 claim valuations.

What This Means for the Crypto Industry

FTX’s collapse exposed critical regulatory gaps in the crypto market, fueling global calls for stricter oversight to protect investors while balancing industry innovation.

The successful execution of this payout may restore confidence in crypto markets, reinforcing the need for better risk management in digital asset exchanges. However, for many creditors, the lack of crypto-denominated reimbursements remains a missed opportunity.

With Bankman-Fried sentenced to 25 years in prison and ordered to pay $11 billion in penalties, the saga of FTX’s collapse is nearing its final chapter—but its impact on the industry will be felt for years to come.

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