FTX Repayment: Crypto User Funds Compensation Process Today

Bittime - FTX has finally begun the process of returning funds (FTX repayment) to its users after two tumultuous years due to the platform's bankruptcy. Check out the latest updates here.

Eligible customers are now starting to receive refunds. The initial distribution of FTX repayment will take place in the next few days. Below is the complete report.

FTX Begins Distribution of Indemnity Funds

Users who submitted claims of up to $50,000 (around Rp. 810 million) began receiving their funds within one to three business days, according to FTX's official statement last Tuesday. The next distribution phase is scheduled to take place on April 11, 2025.

John J. Ray III, administrator of FTX's recovery plan and CEO of FTX Debtors, expressed his satisfaction with the start of distribution of these funds. 

"We appreciate the patience and cooperation of customers and creditors in this complicated process. Our efforts are not finished – we will continue to work to recover and return funds to more eligible parties," he said.

User funds will be available through crypto asset custody platforms such as BitGo and Kraken, which have been appointed to handle the disbursement process.

Read also: Today's Pi Network Price and Its History

FTX Repayment Refund Scheme

In a bankruptcy plan approved by a Delaware court in October 2024, FTX committed to returning a minimum of 118% of the value of claims in cash to 98% of creditors. 

The scheme is aimed at ensuring users get their assets back after huge losses incurred due to the exchange's collapse in 2022.

However, this policy is not free from criticism. Sunil Kavuri, a representative of FTX's largest creditor group, argued that payments should be made in the form of crypto assets, not cash at the value set at the time of bankruptcy two years ago. 

According to him, the value of several crypto assets held by FTX users has experienced a significant increase since 2022, so payments in dollars are considered detrimental to them.

Chronology of the Fall of FTX and Verdict Against Bankman-Fried

The collapse of FTX became one of the biggest scandals in the history of the crypto industry. 

Sam Bankman-Fried, former CEO of FTX, was found guilty of seven criminal charges, including two counts of wire fraud and conspiracy to commit fraud. In November 2023, he was sentenced to nearly 25 years in prison.

In addition, Alameda Research, FTX's sister company which also collapsed, was part of this scandal. Caroline Ellison, former CEO of Alameda Research, was sentenced to two years in prison for her role in FTX's downfall.

What is the fate of FTX users next?

Even though fund distribution has started, many customers are still waiting for their funds to be disbursed. This process is expected to take place over the next few months until all claims are fulfilled.

For users who wish to ensure their eligibility for this refund scheme, FTX recommends monitoring their account on the designated official platform and ensuring all claim requirements have been met.

FTX's recovery process provides valuable lessons for the crypto industry, especially in regulation, transparency and investor protection. With the start of distribution of these funds, there is at least a glimmer of hope for the victims who have lost their assets two years ago.

Read also: Is Jack Dorsey Satoshi Nakamoto the Creator of Bitcoin? This analyst reveals the connection

FAQ

1. Who is entitled to receive a refund from FTX?

Users who submit claims of up to $50,000 (around IDR 810 million) fall into the convenience class customer category and start receiving their funds within 1-3 working days.

2. How do I withdraw funds from FTX?

Funds will be distributed via the BitGo and Kraken platforms. Users can check their accounts on the platform for more information.

3. When will the next FTX repayment distribution take place?

The next distribution phase is scheduled to take place on April 11, 2025.

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Reference 

Cointelegraph, FTX’s $1.2B repayments mark key moment in crypto industry recovery, accessed February 19, 2025.

The Block, FTX begins initial fund distributions to customers as its bankruptcy recovery forges on, accessed February 19, 2025.

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