FTX Begins Repayments for Bahamas Creditors in February

FTX has confirmed its readiness to start repayments for Bahamas creditors on February 18, ahead of larger disbursements expected in Q1 2025. The repayments will be facilitated by BitGo, one of the distribution partners selected during the bankruptcy restructuring hearings.

Repayment Details

Individual Bahamas payment claims will be capped at $50,000, according to Sunil Kavuri, a spokesperson for the largest FTX creditor group. The court-approved reorganization plans, which became effective on January 3, require creditor repayments to begin within 60 days. FTX has $13 billion in payout reserves, although the estate has filed to withhold 50% of this amount for disputed claims.

Here are some key details about the FTX repayments:

  • Repayments will start on February 18, 2025.
  • Funds will be available from 10am ET.
  • FTX claims under $50,000 will be processed.
  • Creditors in the Bahamas have received email confirmation about the repayment start date.
  • A 9% interest per annum will be applied from November 11, 2022.

Background on FTX Collapse

FTX, previously based in the Bahamas, collapsed in 2022 under the leadership of its founder, Sam Bankman-Fried. Investigations uncovered corporate mismanagement and fraud, allegedly orchestrated by the one-time crypto tycoon. Analysts estimate that FTX’s collapse created a $16 billion shortfall.

Ongoing Asset Recovery Efforts

Reorganization administrators, led by bankruptcy CEO John J. Ray III, anticipate that asset recovery efforts could extend until 2027. Meanwhile, Bankman-Fried was convicted on multiple criminal charges, including fraud, and sentenced to 25 years in prison.

“The road to recovery for FTX creditors will be long and complex.”

Bankman-Fried has since alleged judicial bias, requested a new trial, and his parents have reportedly sought a pardon from President Donald Trump. Members of his former inner circle, such as former Alameda Research CEO Caroline Ellison, received lighter sentences and forfeited wealth gained while working for FTX.

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