FTX Recovery Trust Announces Third $1.6B Creditor Distribution

The FTX Recovery Trust, the organization tasked with repaying former customers and creditors of the defunct exchange, has announced a third distribution of nearly $1.6 ￰0￱ to a press release on Friday, the distribution will begin on September ￰1￱ will be transferred to creditors’ accounts via BitGo, Kraken, or Payoneer within three business ￰2￱ Customers First The repayment plan prioritizes two distinct groups of ￰3￱ first is the convenience class, which consists of smaller creditors and retail ￰4￱ group makes up the majority of FTX’s customer base and, surprisingly, will recover approximately 120% of their claims, ultimately receiving more than they ￰5￱ contrast, the non-convenience class, consisting of larger institutional players with more complex claims, will receive smaller ￰6￱ approach highlights a clear priority within the repayment plan, protecting retail customers ￰7￱ latest round of payouts will increase the total recovery for various creditor ￰8￱ will receive an additional 40% of their claims, bringing their total recovery to 95%.

Similarly, Dotcom customers, who used the exchange’s international arm, are set to receive a further 6% payout, raising their total to 78%. Furthermore, general unsecured and digital asset loan claims will be compensated at a rate of 24%, increasing their overall recovery to 85%. Lastly, for the convenience class, which is composed primarily of small creditors and everyday traders, their claims will be paid out at 120% of face value, meaning they will recover more than their initial ￰9￱ History and Market Impact The FTX Recovery Trust has been steadily working to make things right, with over $6.2 billion already paid out to creditors this year alone, a $1.2 billion distribution in February followed by a massive $5 billion payout in ￰10￱ assets valued at a staggering $16.5 billion set aside, the trust is showing its commitment after court approval to reduce the disputed ￰11￱ there were concerns about the first two repayments causing short-term volatility, the actual impact was ￰12￱ creditors, particularly the retail “convenience class,” received their payouts in fiat currency rather than ￰13￱ decision, while frustrating for those who missed out on the crypto market’s significant rebound since late 2022, largely prevented a sudden sell-off of major assets like Bitcoin or Ethereum.