Cryptocurrency exchange FTX, currently in bankruptcy, has announced plans to repay $16 billion in debts by February 18, 2025. Initially, the company plans to distribute up to $7 billion among its creditors, based on cryptocurrency values from November 2022.
What Will the Initial Payment Phase Entail?
The bankruptcy management team has outlined the repayment structure, which sorts creditors into groups based on their claims. In its first phase, the scheme allocates a substantial sum between $6.5 billion and $7 billion among these different groups.
Who Will Get Paid First?
FTX’s repayment strategy prioritizes various creditor categories, especially customer claims and secured debts. The plan ensures that U.S. customers and other stakeholders will receive different payment rates based on their classification.
Key Highlights of the Repayment Structure
Key highlights of the repayment structure include: Full repayment of $250 million for administrative claims and secured debts, a planned payout of $7.9 billion directed towards Dotcom customers, $8.8 billion set for U.S. customers, and lower repayment rates anticipated for unsecured debts and crypto loan claims.
As FTX moves forward with its repayment plan, the strategic focus on prioritizing creditor groups will play a crucial role in restoring trust in the exchange’s operational integrity and financial responsibility.
