The creditor representative of the FTX exchange, Sunil, posted a message late last night disclosing the latest repayment schedule. He stated that the Bahamas FTX has planned to start debt repayment from February 18, 2025, Eastern Time.
This repayment will prioritize creditors with claims less than $50,000, and will provide an additional 9.0% annual interest as compensation since November 11, 2022 until the initial distribution date, meaning creditors will be able to recover about 119% of the claim value in US dollars.
A few hours later, the official X of @FTX_Official also announced that they plan to start repayment on 2/18 (for creditors with claims less than $50,000), which means that users of FTX.com should also start receiving repayment at the same time.
How much will FTX repay?
According to FTX's previous bankruptcy plan, the company estimates that it will have $14.5 billion to $16.3 billion in cash available for compensation, and 98% of creditors (holding amounts less than $50,000) can receive about 118% of their losses.
However, if the requirements are not completed by the deadline, that is, if creditors fail to complete the KYC and claim platform registration process, they will not be able to receive the initial distribution (they can receive the supplementary distribution in subsequent months), so the entire process is expected to continue for several more months.
Additionally, since FTX's repayment assets are in US dollars, investors are optimistic that this will bring a new wave of liquidity to the market.
Although FTX estimates that the vast majority of creditors (claims of $50,000 or less) will be able to recover 118% of the claim value in US dollars, unless the assets held on FTX are stablecoins, they will most likely still suffer heavy losses.
For example, when FTX filed for bankruptcy protection, the BTC price was only around $16,000, but the current BTC price is around $94,000, which means that if a creditor held one Bitcoin on FTX at the time, they would only receive $16,000 in the end, accounting for about 17% of the current price, which can be considered a huge loss.
Haven't you completed the KYC verification yet?
To receive the initial repayment distribution, creditors with claims less than $50,000 must complete the pre-distribution requirements by January 20, 2025 (although the current date has passed, it is still recommended to complete it as soon as possible), including submitting tax forms (Step 7), selecting and successfully registering with the distribution service provider (Step 8), and passing the sanctions review. The complete steps are as follows:
- Log in to the FTX Claims Portal website ( https://claims.ftx.com ) (for customers).
- Complete the required KYC verification. (See the FTX Claims Portal Tutorial by Blocktempo)
- Submit the required tax forms, including the W-8 BEN form. (See the Tax Form Submission Tutorial by Blocktempo)
- After selecting BitGo or Kraken as the distribution service provider in STEP8, read the registration instructions of the selected service provider and register an account with BitGo or Kraken before January 20.
BitGo is a globally regulated cryptocurrency custodian, while Kraken is a well-known US cryptocurrency exchange that provides spot and derivative services in up to 190 countries/regions.
According to Section 7.8 of the Reorganization Plan, if the holder fails to complete the pre-distribution requirements within 6 months from the Initial Distribution Record Date (January 3, 2025), they will lose their distribution rights.
Also, according to Section 7.14, if the holder receives a request to complete the requirements, they must do so within the specified time frame, or they will also lose their distribution eligibility.
