The post FTX News Update: What’s Next for Creditors and Customers as Repayments Begin appeared first on Coinpedia Fintech News
FTX, the once-prominent crypto exchange that collapsed in 2022, is now moving closer to reimbursing its creditors and former customers. After two years of legal battles and bankruptcy proceedings, the exchange has shared a repayment timeline, with initial distributions expected to start by March 2025.
FTX Payments to Begin in 2025
The FTX bankruptcy estate recently announced plans to finalize reimbursement arrangements by January 2025. Distribution agents will be assigned in early December 2024 to oversee the payout process and manage a customer portal for payments.
Meanwhile, John J. Ray III, the interim CEO handling the FTX bankruptcy, assured stakeholders, stating, “We are full steam ahead to return proceeds to creditors and customers as quickly as possible.”
However, the process hasn’t been without challenges. FTX owes approximately $8 billion to its customers, and disagreements among creditors have slowed progress.
Some creditors criticized the repayment plan because it bases payouts on asset values from the petition date when prices like Bitcoin were much lower than today’s rates.
Legal Actions Continue
FTX’s estate is also pursuing lawsuits to recover assets from other exchanges and individuals. In October, it filed a lawsuit against KuCoin to reclaim $50 million in locked assets.
More recently, in November, the estate sought $11 million from Crypto.com and initiated a $100 million lawsuit against Anthony Scaramucci’s SkyBridge Capital over past sponsorship and investment deals.
The recovery efforts aim to boost the available funds for payouts, but these legal disputes highlight the issue of resolving FTX’s financial mess.
Fallout from Mismanagement
FTX’s collapse remains a stark reminder of the risks in the crypto industry. Its founder, Sam Bankman-Fried, was convicted of fraud and sentenced to nearly 25 years in prison. Meanwhile, the estate continues to sort out the outcomes, with customers and creditors still awaiting a resolution.
While progress is being made, the road to recovery for FTX stakeholders remains lengthy and uncertain.