- FTX to start customer payouts in early 2025 as Chapter 11 bankruptcy wraps up.
- Customers must verify accounts and submit tax forms to qualify for FTX payouts by January 2025.
- FTX warns claims traders of risks tied to late transactions near distribution record dates.
FTX is nearing the end of its Chapter 11 bankruptcy process. The company plans to start distributing funds to creditors and customers early in 2025. It represents a major step in the recovery of billions lost in one of the most notorious financial collapses.
John J. Ray III, the restructuring expert leading the cleanup, confirmed the timeline. Moreover, he stated that the company is ready to proceed with the next phase of the process. Months of legal proceedings have paved the way for this critical development.
Distribution Plans and Key Deadlines
FTX has outlined its timeline for distributing funds. In December, the company plans to finalize agreements with global distribution agents. In addition, these agents will manage payouts in various jurisdictions.
Customers will need to complete account setup through FTX’s portal. This includes verifying their identities and submitting required tax forms. In addition, the company emphasized the importance of meeting these requirements to avoid delays.
FTX expects to announce the effective date of its Chapter 11 plan by the end of December. This hinges on court approval of the Disputed Claims Reserve Amount. If approved, the effective date is projected for January 2025.
Initial distributions will target claims under the Plan’s Convenience Classes. FTX has committed to sending these payouts within 60 days of the effective date. Moreover, customers must ensure all paperwork is completed by the record date to qualify.
Risks for Claims Traders
FTX has issued a caution for claims traders. Trades made within 45 days of the record date could face registration delays. In addition, this may result in payouts being sent to the wrong parties. The company advised traders to review their timing carefully.
The legal fallout for FTX’s former executives continues. Gary Wang, the company’s co-founder, was sentenced to time served and three years of supervised release. He also faces an $11 billion financial penalty.
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