Kraken has announced the beginning of the distribution process for creditors of the bankrupt cryptocurrency exchange FTX. This marks an important step in compensating losses after the bankruptcy that occurred in 2022.
Start of Distribution
Creditors who opted for Kraken to manage their claims are receiving emails confirming the completion of the onboarding process. This marks a significant step in repaying losses after FTX's bankruptcy in 2022.
Payment Plan and Timelines
BitGo is set to begin its distribution process soon, although no specific date has been announced. The process varies based on the claim size. Creditors with claims over $50,000 do not have a set timeline for receiving their funds. In contrast, those with claims below $50,000 can expect their payments within 60 days, starting January 3, 2025, with funds likely arriving by March 3, 2025.
FTX Bankruptcy Aftermath
FTX's bankruptcy in November 2022 drew significant attention due to its impact on the crypto market and the financial losses suffered by its users. Founder Sam Bankman-Fried was sentenced to 25 years in prison for fraud and misusing customer funds. At the time, FTX, valued at $32 billion, selected Kraken and BitGo to oversee the recovery and distribution of creditor funds. While the start of claim distribution is a positive development, delays in larger claims may frustrate some creditors.
The distribution of funds to FTX creditors initiated by Kraken marks a significant step in the financial recovery process post-bankruptcy. However, timing delays may continue to pose challenges for some creditors.
