TL;DR:
- The FTX bankruptcy estate will begin the distribution of approximately $900 million at the end of the month.
- The platform has repaid nearly $10 billion to claimants since payments began in 2025.
- Silicon Valley law firm Fenwick & West agreed in May to a $54 million payout to settle claims linked to the case.
The estate of the failed cryptocurrency platform FTX announced that it will begin distributing approximately $900 million to its creditors starting at the close of July.
This procedure represents the fifth massive payment that the bankruptcy administration is making as part of its financial restructuring plan. Previously, during the month of March, the entity disbursed $2.2 billion destined for affected users. With this new move, the total funds returned to customers and other claimants stand near $10 billion since the liquidation process formally began in 2025.
According to official information, eligible recipients who are part of the classes denominated Convenience and Non-Convenience will receive the corresponding capital in their accounts. The document details that the transfers will be processed through the firms BitGo, Kraken, or Payoneer. The money is expected to reflect in balances within an estimated period of three business days once the transaction is initiated.
The Convenience category primarily encompasses retail traders and smaller creditors, who represent the vast majority of the company’s affected user base. In contrast, the Non-Convenience designation involves financial claims of larger volume or with more complex legal structures.
Compensation details and legal agreements
Reports from the Chapter 11 bankruptcy process indicate that the estate seeks to reinstate retail creditors between 118% and 142% of the value their holdings had at the exact moment of the exchange’s collapse in 2022.
However, there are sectors of the investor community that have expressed their dissatisfaction with this cash liquidation strategy. Various creditors have criticized the measure because the plan does not contemplate the return of crypto assets in their original form, thus losing out on the subsequent revaluation of the market.
The resolution of the bankruptcy has also advanced in the judicial field with third parties involved in the historical operation of the firm. During this past May, Silicon Valley law firm Fenwick & West accepted the payment of a millionaire compensation.
This firm served as the principal outside legal counsel for the company’s U.S. division before its bankruptcy in November 2022. The out-of-court agreement stipulated the payment of $54 million by the law firm to resolve lawsuits alleging its presumed collaboration in the fraud scheme executed by Sam Bankman-Fried.
Case administrators will continue verification of customer identities and balances over the coming weeks to ensure the correct execution of this fifth phase of massive payments.
