Creditors from Over 20 Countries, Including Ukraine, May Not Receive FTX Distributions

According to recent information, bankrupt cryptocurrency exchange FTX owes a significant sum of money to creditors in more than 20 countries worldwide, including Ukraine, China, and Russia.

Eligibility for FTX Distributions

As noted by Sunil Kavuri, an FTX creditor, many claims come from jurisdictions currently not eligible for FTX distributions, including:

  • Russia
  • China
  • Egypt
  • Nigeria
  • Ukraine

China has the largest percentage of customers, making up 8% of FTX’s user base. The graph, which was part of a November 2022 bankruptcy hearing, also revealed that the Virgin Islands (11%) and the Cayman Islands (22%) had the highest percentages of FTX users.

Regulatory Hurdles and Cross-Border Payment Issues

In total, 26 countries are excluded from payouts, which are being handled by BitGo and Kraken. Although the exact reason behind these limitations is unclear, it’s assumed that regulatory hurdles and cross-border payment issues are key factors.

FTX’s Asset Recovery and Distribution Plan

In October 2024, FTX announced that it had recovered between $14.7 billion and $16.5 billion in assets for distribution. The exchange previously estimated that it owed creditors around $11.2 billion. According to the plan approved by Delaware bankruptcy Judge John Dorsey, 98% of FTX creditors are set to receive 119% of their allowed claims as of November 2022, when the exchange collapsed.

FTX’s Downfall and Accusations of Fraud

FTX went bankrupt in November 2022 amidst accusations of fraud and mismanagement aimed at both the exchange and its sister company, Alameda Research.

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