Former FTX Customers Confirm Receipt of Payments in Latest $900M Payout
Multiple former customers of the collapsed cryptocurrency platform have confirmed that distribution representatives have started releasing payments to compensate creditors for portions of their losses sustained in 2022.
The recovery trust responsible for compensating creditors of the collapsed FTX cryptocurrency platform has initiated its fifth wave of fund distributions, delivering $900 million to impacted customers.
On Friday, Sunil Kavuri, a former customer of FTX, shared via an X post that he had successfully received distributed funds from the FTX Recovery Trust through the cryptocurrency platform Kraken. According to Kavuri, he was notified the previous week that FTX had transferred the funds to Kraken, which proceeded to release them on Friday as planned, as part of the broader distribution strategy that also involves platforms such as BitGo and Payoneer.
This distribution represents the fifth installment in the ongoing efforts to reimburse FTX's creditors following the platform's bankruptcy filing in 2022. With this latest round of payments now complete, the FTX trust is calculated to have distributed approximately $11 billion in total to affected customers who experienced years without access to their funds.
FTX stood as one of the most significant and high-profile cryptocurrency exchanges to fail during 2022 in the midst of a broader market decline, which led to criminal prosecutions of company executives for the misappropriation of customer funds. As of July, former Chief Executive Officer Sam "SBF" Bankman-Fried and Ryan Salame, who served as co-CEO of FTX's Bahamian entity, remained incarcerated in federal prison, whereas Caroline Ellison, the former Chief Executive Officer of Alameda Research, gained her release in January following a sentence of more than one year.
Binance, ex-CEO to face challenge over $1.76 billion claim from FTX
In a ruling issued last week, a bankruptcy court judge determined that the FTX trust would not be permitted to seek damages against cryptocurrency platform Binance and its former Chief Executive Officer Changpeng Zhao. Nevertheless, Chief Judge Karen B. Owens declined to dismiss the trust's claim seeking to recover $1.76 billion from Binance that was used to buy back its ownership stake in FTX, which the trust contended was partly attributable to "Bankman-Fried's pervasive and now well-known malfeasance."