FTX’s Second Wave of Payouts Sends Bitcoin and Solana into Retreat
Crypto markets flinch as FTX prepares to unleash another round of creditor distributions—because nothing says ’market stability’ like a bankrupt exchange flooding the zone with liquidations.
Bitcoin and Solana lead the downturn as traders brace for impact. The usual suspects—whale movements, leverage unwinds, and that special flavor of post-bankruptcy chaos—are all at play.
Meanwhile, Wall Street shrugs and mutters something about ’risk assets’ while sipping a $28 oat-milk latte. Stay volatile, friends.
Bitcoin, Solana decline as FTX creditor distributions set to commence on May 30
Defunct crypto exchange FTX is set to begin its next round of creditor settlements in May, according to a press release on Thursday. The company revealed that, starting May 30, eligible creditors will partake in over $5 billion worth of distributions as part of its restructuring plan.
The second round of distributions will be directed to both Convenience and Non-Convenience class creditors who have completed the pre-distribution requirements by the start date.
In line with the FTX bankruptcy plan, Dotcom Customer Entitlement Claims will receive a 72% recovery, while US Customer Entitlement Claims are set to receive 54% in distributions.
General Unsecured Claims and Digital Asset Loan Claims will each receive a 61% distribution. Meanwhile, Convenience Claims are expected to receive a 120% refund.
John Ray, Plan Administrator of the FTX Recovery Trust, stated that this second leg of distributions reflects the company’s commitment to "recovering more for creditors and resolving outstanding claims."
Eligible creditors will receive their funds via BitGo or Kraken, which currently function as the distribution service providers. The defunct company stated that when customers register with the service providers, they forfeit any claims to cash distributions.
FTX began its creditor distributions in February, following its collapse in late 2022. The initial recipients of the refunds were Convenience Class creditors with claims of $50,000 or less.
The crypto market has seen a slight decline since the announcement, with Bitcoin (BTC) dropping toward $103,000 at publication time. Solana (SOL) is also down nearly 4%, according to CoinGecko data. FTX unlocked 11.2 million SOL on March 1 to commence the initial distribution to creditors, which sent prices tumbling at the time.
The recent price decline could stem from investor concerns over the possible impact of the distributions on the crypto market.
