FTX Trading Ltd. and the FTX Recovery Trust say they will send roughly $900 million to eligible creditors on July 31, marking the fifth major distribution in the bankruptcy process. Once this round is completed, total disclosed repayments from the estate are expected to move above $10 billion.

July 31 distribution

According to the announcement, payments will go to creditors in the Convenience and Non-Convenience classes who completed required pre-payment steps by the June 16 record date. The funds are expected to arrive within one to three business days after July 31 through BitGo, Kraken, or Payoneer.

The new distribution comes as the Chapter 11 restructuring, which began in early 2025, continues to move through successive payout rounds. FTX said the latest payment wave totals about $900 million for creditors, with a separate $18 million scheduled for preferred equity holders on the same date.

Recovery levels by claim class

The fifth distribution increases recoveries by different amounts depending on the creditor class. Dotcom Customer Claims, listed as Class 5A, will rise by 9 percentage points to reach 105% of allowed claim value. US Customer Claims, or Class 5B, will increase by 5 percentage points to the same 105% level.

General Unsecured Claims and Digital Asset Loan Claims will each gain 3 percentage points, taking them to 103% of allowed claim value. Convenience Class creditors remain the highest-recovering group at 120%.

FTX also said the additional $18 million for Preferred Equity Holders will bring total PSRFT payments to $95 million. The company noted that those amounts are separate and are not included in creditor recovery totals.

Why this round was possible

One factor behind the fifth distribution is a court-approved reduction in reserved disputed claims. That reserve was lowered from $2.4 billion to $1.8 billion, freeing additional funds for distribution.

Even so, the process is not close to finished. The trust still has disputed claims to resolve, along with illiquid investments and international recovery issues. FTX said these remaining matters are expected to extend the overall recovery process into 2027. No new record date or size has been announced for any future distribution.

Ongoing frustration over valuation

Although several classes are now reaching or exceeding full recovery in nominal terms, some creditors remain dissatisfied with the structure of the payouts. Recoveries are being calculated using the dollar value of account holdings as of November 11, 2022, rather than current crypto market prices.

That distinction has been a persistent source of tension because digital asset prices have risen sharply since FTX collapsed. The source article gave one example: a creditor with 1 BTC would receive roughly $16,800 in cash at a 105% recovery rate under the bankruptcy valuation framework, compared with more than $65,000 if that coin were valued at current market levels.

As a result, the headline recovery percentages do not necessarily reflect how creditors view the outcome relative to the broader rebound in crypto prices since late 2022.

Source: Cryptopolitan