By Nermeen Nabil Khear 
FTX Trading Ltd. and the FTX Recovery Trust have revealed that the distribution to creditors will begin on February 18, 2025, in accordance with FTX’s Chapter 11 Plan of Reorganization (the “Plan”).
The first round of distributions will only be available to holders of allowed claims in the Plan’s Convenience Classes who have met the necessary steps before distribution can take place.
FTX has indicated that eligible creditors can receive their distributions one to three business days after the first distribution date. Later, further details on separate records and payment dates for other classes of claims will also be provided.
FTX transfers funds for creditor payouts as Bankman-Fried’s family seeks pardon
FTX has announced that it has managed to transfer the funds for the initial distributions to BitGo and Kraken, the Distribution Service Providers that will process the payments. Both retail and institutional customers and other creditors in supported jurisdictions will receive their share of the recoveries in accordance with the Plan.
FTX was a leading cryptocurrency exchange that went bankrupt in November 2022 amid allegations that its owners had embezzled and misused customer funds. Sam Bankman-Fried, the CEO of the exchange, was sentenced to 25 years in prison and ordered to repay $11 billion.
Just a week ago, the parents of FTX co-founder Sam Bankman-Fried were exploring ways to secure a pardon from President Donald Trump for the onetime crypto billionaire. Still, it’s unclear if outreach has been made to the White House.
Bankman-Fried currently lacks widespread support but has argued that his sentence is “draconian,” citing the significant recovery of funds by FTX customers. Meanwhile, former FTX executive Ryan Salame, who was sentenced to over seven years in prison, has also stated that he is seeking a pardon.
FTX urges creditors to contact support as Bitcoin withdrawals surge
FTX has informed eligible creditors that if they have any concerns about the availability of their funds, they should contact the customer support of the selected Distribution Service Provider. Once received, creditors will have full control over their funds.
The announcement is a welcome relief for FTX creditors who have been waiting to be compensated for two years since the exchange’s downfall.
In a recent post, caueconomy noted the largest volume of exchange withdrawals since the FTX collapse. The data shows more than 47,000 BTC were taken from exchange reserves.
Some of them may be internal, but they also suggest a potential accumulation by a large market player or institutional entity. This trend of Bitcoin exiting exchanges is generally considered bullish in the long term as it reduces the supply of coins in the market that can be sold.
However, caueconomy noted that this shift does not result in a supply shock that can affect Bitcoin’s price in the short run. Instead, it suggests the beginning of an accumulation phase that may help the price grow in the future.
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This articles is written by : Nermeen Nabil Khear Abdelmalak
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