FTX, the cryptocurrency exchange currently in bankruptcy, has announced a monumental plan to repay $16 billion in debts by February 18, 2025. The initial step will see the exchange distribute between $6.5 billion and $7 billion to its creditors, with the amounts calculated based on cryptocurrency values from November 2022.
What Will the Initial Payment Phase Entail?
The bankruptcy management team has outlined the repayment structure, which sorts creditors into groups based on their claims. In its first phase, the plan aims to allocate a substantial sum between $6.5 billion and $7 billion among these different groups.
Who Will Get Paid First?
FTX’s repayment strategy prioritizes various creditor categories, especially customer claims and secured debts. The plan ensures that U.S. customers and other stakeholders will receive different payment rates based on their classification.
Key highlights of the repayment structure include:
- Full repayment of $250 million for administrative claims and secured debts.
- A planned payout of $7.9 billion directed towards Dotcom customers.
- U.S. customers set to receive a total of $8.8 billion.
- Lower repayment rates anticipated for unsecured debts and crypto loan claims.
As FTX moves forward with its repayment plan, the strategic focus on prioritizing creditor groups will play a crucial role in restoring trust in the exchange’s operational integrity and financial responsibility.
