FTX plans to release approximately $900 million to creditors on July 31, pushing total repayments beyond $10 billion and marking the fifth major distribution since its Chapter 11 restructuring began in early 2025. Several creditor groups have now recovered between 103% and 105% of their allowed claims, with retail Convenience Class creditors reaching a 120% recovery rate based on valuations from November 2022.
Distribution Details and Impact on Creditors
The payout targets claimants in both Convenience and Non-Convenience Classes who completed pre-payment steps by the June 16 record date. Payments will be processed within 1 to 3 business days after July 31 via BitGo, Kraken, or Payoneer. Dotcom Customer Claims (Class 5A) get an additional 9%, raising their cumulative recovery to 105%. US Customer Claims (Class 5B) receive 5%, matching the 105% figure. General Unsecured Claims and Digital Asset Loan Claims each gain 3%, reaching 103% cumulative recovery.
Convenience Class creditors, who represent most retail creditors, have achieved the highest cumulative recovery of 120%. An $18 million distribution to Preferred Equity Holders is also scheduled from the Preferred Shareholder Remission Fund Trust on the same date, totaling $95 million in disbursements, separate from customer recoveries.
Reasoning Behind the Latest Distribution
The fifth payout was facilitated by a court-approved reduction in the reserve against disputed claims, decreasing from $2.4 billion to $1.8 billion, freeing funds for creditor payments. Despite the payments, creditors remain discontent as repayments are made in dollars, preventing participation in recent crypto market gains since FTX's 2022 collapse.
This material is for informational purposes only and not financial advice.
