FTX Begins Initial $1.2 Billion Payout to Creditors

The payout process for creditors of the collapsed cryptocurrency exchange FTX has officially commenced, with initial distributions totaling approximately $1.2 billion. The payments are being processed in U.S. dollars through BitGo and Kraken, marking a significant milestone in the ongoing bankruptcy proceedings.

Small Creditors Receive Payments With Accrued Interest

Creditors with claims below $50,000 have begun receiving their payments, which include 9% annual interest accrued since November 2022. Multiple users on the FTX subreddit have reported funds appearing in their Kraken accounts, reflecting a payout exceeding their initial adjudicated claim value.

According to the FTX bankruptcy plan, these creditors are set to receive approximately 119% of their approved claims, a rare outcome in bankruptcy settlements.

Blockchain analytics firm Arkham Intelligence has also tracked wallet outflows from FTX, confirming the distribution process is underway.

Larger Claims Set for Second-Quarter Payouts

While smaller creditors are receiving their funds now, those with claims exceeding $50,000 are scheduled to begin receiving their distributions in the second quarter of 2025. In total, FTX plans to distribute around $16 billion to creditors as part of its bankruptcy resolution.

Payments Processed via Kraken and BitGo

The funds are being distributed through BitGo and Kraken, with Kraken taking additional steps to support affected users. Screenshots shared on Reddit indicate that Kraken issued trading fee credits alongside the payments, a move seen as a way to distribute funds without profiting from the process.

The initiation of payouts signals progress in FTX’s complex bankruptcy proceedings, offering partial restitution to affected users. However, with larger creditor payments still pending, the full resolution of the exchange’s collapse remains an ongoing process.