- FTX’s repayment plan starts February 18, 2025, for creditors under $50k.
- Bitcoin’s rise means creditors missed out on significant gains since 2022.
- BitGo partners with FTX to ensure a secure, error-free fund distribution process.
Failed cryptocurrency exchange FTX says it will pay back some creditors from the Bahamas on February 18, 2025. This repayment is aimed at customers with claims under $50,000 and will kick off at 10:00 a.m. ET.
The company says this phase of the repayment process is laid out in its reorganization plan, approved back in December 2024 and put into action in January 2025. Now that the payment system is set up, FTX hopes to rebuild some trust among its creditors who have stuck around.
FTX Repayment Plan: Claims Under $50K
FTX’s repayment plan will prioritize the “convenience classes,” meaning those creditors with claims below $50,000. Once these payments are made, FTX will wipe out all related claims, bringing a close to a lengthy legal battle. The payment amounts reflect the US dollar value of customer deposits as of November 2022, when Bitcoin was around $17,000.
Since that time, Bitcoin has shot up to roughly $100,000. That said, creditors have missed out on major gains. Take this as an example: a customer who had $50,000 in Bitcoin in November 2022 could have seen their holdings grow to approximately $295,000 today.
Related: FTX/Alameda Redeems Over 4M SOL Tokens: A Closer Look at Transfers
FTX and BitGo: Ensuring Secure Fund Transfers
To make sure the distribution of funds goes smoothly, FTX has teamed up with BitGo, a well-known digital asset custody and security firm. BitGo’s technology will help avoid any delays or errors in getting the money out, which is important for keeping creditor confidence up.
While this first round of payments takes care of smaller claims, FTX has stated that larger repayments will come later, with further announcements on the way as things progress.
Related: FTX Slams Backpack’s Misleading FTX EU Fund Distribution Claims
FTX Bankruptcy: Two Years Later
FTX’s repayment announcement lands more than two years after the exchange filed for Chapter 11 bankruptcy protection. FTX’s fall was caused by a liquidity crisis that revealed severe mismanagement, including the unlawful moving of customer funds to its sister company, Alameda Research. This scandal has resulted in significant legal consequences, including the conviction of former CEO Sam Bankman-Fried, who was sentenced to 25 years in prison.
Disclaimer: The information presented in this article is for informational and educational purposes only. The article does not constitute financial advice or advice of any kind. Coin Edition is not responsible for any losses incurred as a result of the utilization of content, products, or services mentioned. Readers are advised to exercise caution before taking any action related to the company.
