FTX Coughs Up $5B to Creditors—Just Another Day in Crypto Bankruptcy Theater

Bankrupt exchange starts unloading its vaults—because nothing says ’trust us’ like a fire sale.

Creditors brace for impact as FTX scrambles to meet obligations. Who said crypto wasn’t predictable? Just add ’billions’ and ’legal drama.’

Bonus jab: At least traditional banks wait until after the bailout to disappoint everyone.

In brief

• On May 30, FTX will distribute 5 billion dollars to creditors.
• Repayments vary between 54% and 120% depending on the categories.
• More than 14 million crypto accounts will be concerned by these payments.
• BitGo and Kraken will ensure distribution within 1 to 3 business days.

What crypto exchange creditors can expect on May 30

Repayments resume: on May 30, FTX Recovery Trust begins the. More thanwill be redistributed to eligible creditors. They will receivedepending on their category. BitGo and Kraken will ensure distribution within one to three business days. This step implements part of the bankruptcy plan. 

Furthermore, this process aims toduring the abrupt collapse. It benefits millions of accounts, most of which have already received partial payments. John J. RAY III, administrator of the FTX Recovery Trust, reminds us: 

These first distributions outside of convenience class are an important step for FTX.

John J. Ray III and the pride of an unprecedented repayment plan 

John J. Ray III does not hide his satisfaction. According to him, this repayment plan is “unprecedented” in the crypto world. He welcomes the collective effort of legal, financial and technical teams. For almost three years, this group has coordinated massive asset recovery operations. 

This strategy has enabled, with a significant part coming from successful investments in crypto startups. Furthermore, the plan provides for other phases to compensate remaining creditors. For crypto investors, this transparency is reassuring. It demonstrates a commitment to restoring confidence in a sector shaken by the FTX scandal. 

“The scope and scale of the FTX creditor base make this process exceptional“, emphasizes John J. Ray III.

Recovery operations and key figures to remember for crypto investors

Since the collapse, recovery operations have multiplied. Theseek to maximize the funds returned. The first phase of repayments, launched in February, has already paid more than 1 billion dollars to 90% of creditors. The next phase will strengthen this amount. 

Here are the key figures to remember:

• More than 5 billion dollars will be distributed as of May 30;
• Repayment rates vary from 54% to 120% depending on categories;
• More than 14 million crypto accounts are concerned by these payments;
• The recovered sum could reach up to 16.5 billion thanks to lawsuits;
• Funds will be paid via BitGo and Kraken within 1 to 3 business days.

This massive liquidity injection could positively influence the crypto market, especially altcoins. Furthermore, traders like ICOBeast.eth mention.

From his cell, Sam Bankman-Fried is making efforts to regain ground. He tries to WOO the Republicans, hoping to gain political support. This strategy aims to influence his judicial future and one day regain control of FTX. He thus shows how much he wants to return to the head of this fallen crypto empire.

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