FTX’s $5B Payout Begins May 30—Creditors Finally See Light (And Cash)
After years of legal wrangling and enough paperwork to bury a blockchain, FTX creditors finally get their due. The failed crypto exchange starts doling out $5 billion in repayments on May 30—just in time for summer yacht season.
From bankruptcy to payday
The court-approved distribution marks a rare win for crypto’s burned investors. Though let’s be honest—it’s still pennies on the dollar compared to 2021’s fantasy valuations.
The fine print
Payouts will hit approved claims first, with clawbacks from politically-connected beneficiaries likely fueling future lawsuits. Because in crypto, the drama never really ends—it just gets arbitraged.
Repayment Efforts
In a May 15 release, the company’s bankruptcy estate categorized creditors into five “convenience classes” with specified payout rates. Members of creditors Class 5A will receive a 72% distribution, while Class 5B will be paid 54%.
Classes 6A and 6B, comprised of small lenders and Alameda Research trading partners, are each set for 61% distributions. Finally, Class 7 Convenience Claims will receive 120%.
John J. RAY III described the upcoming payments as a major development, stating:
“These first non-convenience class distributions are an important milestone for FTX. The scope and magnitude of the FTX creditor base makes this an unprecedented distribution process.”
He added that the announcement demonstrated the strong results of the team’s recovery and coordination efforts and emphasized that their focus remained on maximizing returns for creditors and addressing unresolved claims.
Eligible creditors are expected to receive their funds through their selected distribution service provider, either Bitgo or Kraken, within one to three business days after May 30. However, customers who onboard with a Distribution Service Provider will forfeit the right to receive cash directly from the bankrupt exchange, with all funds sent through their chosen provider instead.
The FTX Recovery Trust also said that the repayment schedule for upcoming creditor classes will be announced in due course. If all claims are filed, total repayments could reach up to $16.5 billion.
Separately, the FTX bankruptcy estate initiated legal proceedings in April against NFT Stars Limited and Delysium. The lawsuits aim to recover digital assets allegedly withheld from the estate and are part of the company’s efforts to reclaim funds and maximize recoveries following its November 2022 collapse.
Criticism Over Valuation Method
FTX currently has about $11.4 billion allocated for creditor repayments. The first round of reimbursements began on February 18, 2025, directed at creditors with “convenience claims” under $50,000. Approximately $1.2 billion was paid out in that phase.
The second distribution phase will now target those with requests exceeding that amount. These include major investors and institutions that held millions in crypto on the platform.
Despite progress, the repayment model has faced criticism for calculating reimbursements based on crypto values at the time of the bankruptcy filing. This has led to some creditors receiving less than the current market value of their holdings.
