FTX repayments will begin on May 30th, with more than $5 billion in allocations expected

Author: Turner Wright, CoinTelegraph; Translated by: Deng Tong, Golden Finance

More than two and a half years after filing for bankruptcy, cryptocurrency exchange FTX is working to repay users who cannot use their funds.

The FTX Recovery Trust announced in a May 15 notice that it will begin issuing funds to the second batch of creditors compliant with the exchange 's restructuring plan. Starting May 30, FTX will distribute more than $5 billion to creditors through cryptocurrency companies BitGo and Kraken “within 1 to 3 working days.”

According to the restructuring plan, FTX said five groups of “convenience categories” will receive 54% to 120% of asset allocation. The next batch of creditors’ repayment plans will be “disclosed in due course” and if all claims are met, the debtor is expected to pay up to $16 billion.

FTX second round repayment details. Source: Sunil Kavuri

FTX began its first round of repayments on February 18 and is expected to repay approximately US$1.2 billion to creditors. While former FTX users are likely to receive their own funds for the first time since the exchange collapsed in November 2022, many criticized the restructuring plan for repayment based on the price of cryptocurrencies at the time of bankruptcy.

Since the end of 2022, the price of Bitcoin has risen by more than 400%, from about $20,000 to more than $100,000 at the time of this article’s publication. Under the recovery plan, 98% of creditors are expected to receive at least 118% of the value of their initial claims.

Criminal case closed

Former FTX CEO Sam “SBF” Bankman-Fried was found guilty of misappropriating client funds and sentenced to 25 years in prison, more than a year later, the Estate Management Commission made the announcement. Former Alameda Research CEO Caroline Ellison and former FTX Digital Markets co-CEO Ryan Salame have pleaded guilty and were sentenced to two and a half years in prison, respectively.

FTX Engineering Director Nishad Singh and co-founder Gary Wang have also pleaded guilty and have been sentenced to a sentence of serving. However, Salame's wife Michelle Bond, who may not be directly involved in the exchange's activities, is still facing campaign funding charges in New York.