FTX will begin its fifth creditor distribution on July 31, sending nearly $900 million to eligible claimants under its court-approved recovery plan.
Summary
- FTX will distribute nearly $900 million to eligible creditors beginning July 31 through approved providers.
- The fifth payout round pushes total creditor distributions to about $10 billion since FTX collapsed.
- Bankman-Fried faces growing political resistance to clemency after losing his appeal against the fraud conviction.
The payment will cover creditors in the Convenience and Non-Convenience Classes who completed required steps before the June 16 record date.
A repayment update shared by creditor advocate Sunil Kavuri said eligible users can receive funds through BitGo, Kraken or Payoneer. Payments should arrive within one to three business days after distribution starts. The new round brings total payouts since FTX entered bankruptcy to about $10 billion.
FTX moves ahead with fifth creditor distribution
FTX’s recovery process continues nearly four years after the exchange filed for Chapter 11 bankruptcy in November 2022. The company collapsed after a liquidity crisis exposed a large gap in customer assets and left users unable to access funds held on the platform.
Convenience claims below $50,000 are set to receive 120% of their allowed claim value under the recovery plan. Other eligible classes are expected to receive distributions of about 103% to 105%, according to the creditor update. FTX said future dates will depend on claim approvals and eligibility.
Bankruptcy estate keeps returning recovered funds
The July payment follows earlier rounds that returned billions of dollars to former customers and creditors. The estate has funded repayments through recovered cash, investments and asset sales carried out during the bankruptcy process.
Some of those sales have drawn criticism from creditors because several assets later rose sharply in value. As reported by crypto.news, the estate sold a 5% stake in Cursor developer Anysphere for $200,000 in 2023. That former stake was later estimated at about $3 billion based on a reported $60 billion valuation.
Legal disputes tied to FTX remain active
FTX’s collapse continues to produce lawsuits involving former executives, advisers and other parties linked to the exchange. In May, law firm Fenwick & West agreed to pay $54 million to settle claims brought by former FTX customers.
As reported by crypto.news, the plaintiffs accused the firm of helping create legal structures that allowed FTX and Alameda Research to move customer funds without proper safeguards. Fenwick denied wrongdoing, and the proposed settlement requires court approval.
Bankman-Fried faces resistance to clemency
Former FTX CEO Sam Bankman-Fried remains in federal prison after a jury convicted him of fraud and conspiracy charges linked to the exchange’s collapse. A judge sentenced him to 25 years in prison in 2024.
His legal options narrowed in June when a federal appeals court upheld his conviction and sentence. As reported by crypto.news, the court rejected arguments that the trial judge improperly limited evidence that Bankman-Fried wanted to present.
Bankman-Fried has also sought a presidential pardon, but the effort faces political opposition. The U.S. Senate unanimously adopted a resolution opposing clemency, as reported by crypto.news. The resolution cannot prevent a president from granting a pardon, but it places senators on record against clemency.
The latest $900 million payout keeps FTX’s repayment process moving while legal cases tied to the exchange remain unresolved. Creditors who qualify for the July round must use an approved distribution provider and complete all required verification steps before receiving funds.
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