FTX Plans $1.6B Third Creditor Payout Amid Bankruptcy Recovery

FTX, the cryptocurrency exchange that collapsed in November 2022 amid fraud allegations, will begin distributing an additional $1.6 billion to creditors starting September 30 as part of its Chapter 11 bankruptcy reorganization plan. This third payout will cover various creditor classes, including retail traders (convenience class), larger claims (non-convenience class), and unsecured lenders, with cumulative recovery rates reaching up to 120% for convenience claims and 85% for unsecured lenders. The bankruptcy plan leverages over $15 billion in recovered assets, including cash reserves, clawbacks, and proceeds from the sale of investments such as stakes in Anthropic and Robinhood, as well as stockpiles of tokens like SOL and SUI. Funds will be distributed through service providers BitGo, Kraken, and Payoneer, with creditors expected to receive payments within one to three business days after the payout date. While some former users have expressed frustration over the value of payouts compared to current crypto market prices, the Recovery Trust continues to pursue asset liquidation and litigation to maximize creditor returns. Future distributions will be announced as additional funds are recovered or claims processed.