FTX Creditors Face Delays and Disputes as Bankruptcy Payments Continue

Bankrupt cryptocurrency exchange FTX is proceeding with its debtor recovery process, initiated the second round of payments on May 30. These payments disbursed assets exceeding $5 billion to eligible creditors who completed pre-distribution requirements.

Nevertheless, at least $2.25 billion in claims remains under dispute. Sunil, an FTX creditor and Customer Ad-Hoc Committee member, estimates a current approved claims amount of $7.5 billion against a potential total estimated of $10.6 billion, citing that approximately 30% of existing claims are still in dispute.

“Current allowed claims: $7.5bn. Total Estimated allowed claims: $10.6bn. 30% of allowed claims are disputed – legit claims will be allowed,” Sunil reported in a June 11 update on X.

According to Sunil, the disputed claims are likely to be processed in the next distribution, drawing funds held by the FTX estate specifically for such claims ($6.5 billion). He added that the resolution of these claims remains uncertain, particularly concerning claims originating in China, which constitute 8% of the total bankruptcy claims.

Creditors continue to encounter practical challenges. Reports cite difficulties with mandatory Know Your Customer (KYC) verification for receiving payments. One creditor described feeling under intense scrutiny during the verification process.

The administered FTX estate has recently expanded its payment processing partners. Payoneer has joined BitGo and Kraken as a distribution service provider, aiming to facilitate payouts, particularly to retail customers.