After months of waiting, major creditors of FTX can finally see the light at the end of the tunnel. The platform announced repayments will start from May 30, 2025.
Plans for major creditors reimbursement
This is a crucial moment for the thousands of investors who suffered after the crypto exchange's collapse in 2022. FTX has managed to gather $11.4 billion in cash, which will finally be used to compensate the colossal losses of its creditors. Those with claims exceeding $50,000, including financial institutions, companies, and large holders, will be prioritized in this wave of payments.
Issues with compensation in dollars
Compensation will be paid in dollars, creating issues for some creditors. For example, a holder of claims in bitcoin will be compensated based on the value of BTC at the time of bankruptcy, which is nearly five times less than its current value. In other words, the payments would barely cover around 20% of today's market price.
Partial relief for investors
This partial return of funds represents relief for many investors. It also marks a symbolic step in the long saga of FTX, which has become emblematic of the excesses of the crypto market. While the losses will not be fully compensated, the gesture provides a small breath of fresh air for the crypto sector.
The reimbursement by FTX opens a new chapter for thousands of investors. Sam Bankman-Fried is still in prison and was recently transferred in secret following a shocking revelation.
