FTX, the cryptocurrency exchange, is set to begin payments to creditors holding claims of under $50,000 starting February 18, 2025, as part of its reorganization plan.
Distribution Process
To ensure secure and efficient fund distribution, FTX has partnered with BitGo, a leading digital asset custody and security firm. BitGo's advanced infrastructure is expected to minimize potential delays and errors in the repayment process.
Communication with Creditors
FTX has begun notifying eligible creditors via email, providing guidance on the repayment process. Creditors are advised to complete necessary procedures, including Know Your Customer (KYC) verification, to facilitate timely payments. It is important to note that creditors who have not completed KYC procedures account for approximately $345 million in claims.
Future Repayments and Considerations
Following the initial repayments to creditors with claims under $50,000, FTX plans to address larger claims in subsequent phases. The company has outlined a phased approach to debt repayment, prioritizing smaller claims initially, with subsequent repayments to be announced as the process unfolds.
The initial repayments by FTX mark a crucial step in the company's reorganization process. This initiative helps build creditor confidence and lays the foundation for subsequent debt repayment actions.
