FTX and its affiliated debtors announcement They are on track to implement their Chapter 11 reorganization plan by January 2025, which will set distributions for creditors and customers.
According to the timeline communicated in the company’s announcement, final arrangements with specialist distribution agents will be finalized in December, allowing clients in supported jurisdictions to open accounts through FTX’s client portal.
Additionally, the firm will reveal the exact date of reimbursements in the same month once it obtains court approval for the contested claims reserve amount.
The first round of distributions will begin in January 2025, targeting convenience class holders, and will be scheduled within 60 days of the effective date.
FTX CEO John J. Ray III said:
“We are pleased to announce that we will begin distributing profits in early 2025. The established schedule reflects the experience and continued work of the team of professionals supporting the debtors, who have already recovered billions of dollars on behalf of creditors and FTX clients. »
U.S. Bankruptcy Judge John Dorsey approved the $16.5 billion stimulus plan during a hearing in Wilmington, Delaware, on October 7. Customer repayments are dependent on settlements reached with FTX customers, creditors, U.S. government agencies and international liquidators.
The approved plan prioritizes FTX customers, allowing the exchange to reimburse their claims first, ahead of competing claims from government regulators.
The total value recovered could reach $16.5 billion, subject to falling to $14.7 billion after it is converted into cash.
FTX collapsed in November 2022 after its founder, Sam Bankman-Fried, and other executives mismanaged customer funds and used them in other businesses. Authorities estimate that FTX’s collapse left around 9 million customers and investors facing substantial financial losses.
Refund conditions
FTX emphasized that customers must establish approved accounts with distribution agents, complete Know Your Customer (KYC) verification, and submit tax forms before the distribution registration date to qualify for the upfront payment.
Debt dealers have also been warned that transfers made within 45 days of the distribution record date may not be reflected in the debt register on time, potentially redirecting distributions to the original debt holders.
