FTX to pay out additional $1.6 billion to creditors in third distribution

Defunct crypto exchange FTX will disburse an additional $1.6 billion to creditors beginning at the end of the month. The bankruptcy estate's third distribution will kick off on Sept. 30 as part of its ongoing Chapter 11 reorganization plan, according to an announcement on Friday.

The latest FTX payments will be for both the exchange's convenience and non-convenience classes. The so-called convenience class typically refers to the retail traders and smaller creditors who make up the majority (up to 99%) of FTX's creditor base, whereas the non-convenience designation involves larger or more complex claims.

FTX’s first two distributions were designed so that retail users of the exchange would receive a refund worth around 120% of their exchange balances at the time FTX declared bankruptcy in November 2022.

That said, some former users have expressed frustration with FTX’s bankruptcy process, arguing that the estate's cash payouts are worth far less than their crypto assets would be worth today had they not been liquidated, given the market rebound since the depths of the pandemic-era bear market.

Meanwhile, unsecured lenders, like Classes 6A General Unsecured Claims and 6B Digital Asset Loan Claims, or those that lent to Sam Bankman-Fried's FTX and sister trading firm Alameda Research, have received an 85% cumulative distribution to date, FTX said. The exchange’s bankruptcy plan projects full recovery for these lenders.

The bankruptcy plan, finalized in October 2024, leverages over $15 billion in recovered assets, including cash reserves from FTX’s operations, recovered funds from clawbacks, and proceeds from selling investments like Bankman-Fried’s stake in AI studio Anthropic and brokerage Robinhood, as well as massive stockpiles of tokens like SOL and SUI.

Eligible creditors should receive funds from their selected distribution service provider — i.e., Bitgo, Kraken, or Payoneer — within one to three business days beginning Sept. 30.

FTX filed for bankruptcy on Nov. 11, 2022, after a liquidity crisis triggered by massive customer withdrawals and reports of mismanagement and misuse of customer funds by its leadership.

Disclaimer: The Block is an independent media outlet that delivers news, research, and data. As of November 2023, Foresight Ventures is a majority investor of The Block. Foresight Ventures invests in other companies in the crypto space. Crypto exchange Bitget is an anchor LP for Foresight Ventures. The Block continues to operate independently to deliver objective, impactful, and timely information about the crypto industry. Here are our current financial disclosures.

© 2025 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.