FTX and related debtors announced on December 16 that their reorganization plan will take effect on January 3, 2025 and distribution will begin within 60 days.
FTX with BitGo and Kraken To manage the distribution process for retail and institutional creditors. According to the claim portal, these service providers ensure that distributions run efficiently and securely across supported jurisdictions while also enabling distributions via stablecoins.
The initial distribution applies only to creditors in the “convenience classes” of the program, and FTX announces separate payment dates for other classes. Additionally, the company noted that it will announce additional distribution service providers on its customer portal and official communication channels.
CEO of FTX John Jay Ray III stated:
We are well positioned to begin distributing recoveries to all customers and creditors and encourage customers to take the necessary steps to begin receiving distributions in a timely manner.
Ray also stressed the importance of meeting eligibility requirements to receive prompt payments and urged creditors to take the necessary steps through the FTX debtors' customer portal.
Eligibility
Creditors eligible for initial distribution must complete several key steps prior to the effective date, such as completing validation of their customers, submitting tax forms and attending distribution partners.
Distributions for transferred claims will only be made to holders whose claims are filed by January 3, 2025 and who have a 21-day no-objection notice period.
FTX warned users to avoid phishing scams and reminded creditors that official communications are only made through approved channels. The company emphasized that it will never ask users to link wallets or provide sensitive financial details outside of the official customer portal.
U.S. Bankruptcy Judge John Dorsey approved the $16.5 billion recovery plan at a hearing in Wilmington, Delaware, on Oct. 7. The total value after its cash conversion is reduced to $14.7 billion.
FTX crashed in November 2022 after its founder. Sam Benkman-FriedAnd other managers were mismanaging clients' assets and using them in other investments. Officials estimate that the collapse of FTX caused about 9 million customers and investors to face significant financial losses.
