Creditors of the defunct crypto exchange FTX have begun receiving their initial payouts in their Kraken accounts, marking a major milestone in the company’s ongoing bankruptcy proceedings.
Claimants with approved amounts under $50,000 are receiving full reimbursements, plus 9% annual interest accrued since FTX filed for Chapter 11 bankruptcy in November 2022.
Screenshots shared online show that some creditors received amounts exceeding their original claims, reflecting interest accumulated over more than two years.
Initial disbursements
Blockchain analytics firm Arkham Intelligence confirmed significant outflows from FTX-controlled wallets, estimating that around $1.2 billion is being distributed in this first phase.
According to the court-approved bankruptcy plan, creditors in this category will receive approximately 119% of their adjudicated claim value.
Larger creditors — those with claims exceeding $50,000 — are set to begin receiving payments in the second quarter of 2025, with roughly $16 billion earmarked for total distributions.
The repayments, made in US dollars, are being facilitated through BitGo and Kraken. Some recipients noted that Kraken provided trading fee credits in addition to the deposits, a move seen as a way to ensure smooth fund distribution without the exchange profiting from the process.
Collapse and repayment efforts
FTX imploded in November 2022 following revelations of widespread financial mismanagement, missing customer funds, and alleged fraud orchestrated by its leadership.
The company’s downfall left billions in assets frozen, triggering a complex legal battle that culminated in the criminal conviction of founder Sam Bankman-Fried in 2023.
Since then, the bankruptcy process has focused on asset recovery and creditor repayment, with FTX’s estate liquidating holdings, selling assets, and reaching settlements to amass funds for distributions.
Legal filings suggest that the estate recovered more assets than initially anticipated, allowing it to fully compensate smaller creditors and provide significant returns to larger claimants.
While the current distributions mark a step forward, some creditors have expressed frustration over the repayment timeline, particularly those with claims above the $50,000 threshold who must wait months for their share of the $16 billion in remaining funds.
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