Over $2 Billion in Repayments Remain Unapproved
Bankrupt cryptocurrency exchange FTX is facing renewed pressure from users seeking to unlock $2.2 billion in still-disputed claims. While the second round of repayments began on May 30, involving over $5 billion in digital assets, many creditors have yet to receive approval for their claims due to unresolved disputes and KYC verification issues.
According to creditor representative Sunil, a member of the FTX Customer Ad-Hoc Committee, current allowed claims total $7.5 billion, while total estimated allowed claims are projected to reach $10.6 billion.
“30% of allowed claims are still under dispute,” Sunil wrote in a June 11 post on X, noting that many of these may be approved in the next distribution round.
The FTX estate is reportedly holding $6.5 billion in reserves for disputed claims, funds that may be released in the next repayment cycle, though uncertainty remains, particularly regarding Chinese claimants, who represent 8% of all claims.
First and Second Distribution Rounds
FTX’s first payment round on February 18 saw $1.2 billion distributed to claimants with less than $50,000 at stake. The second wave in May expanded to cover larger claims, yet many creditors remain locked out due to pending verification and documentation hurdles.
The $2.25 billion in pending repayments represents roughly 21% of the total estimated claims.
New Payment Partner and Verification Woes
To facilitate payouts, FTX has now partnered with Payoneer, its third distribution partner alongside Kraken and BitGo. Payoneer, which operates in over 190 countries, is expected to streamline retail user payouts globally.
Despite this, multiple creditors are encountering significant KYC (Know Your Customer) issues. One user reported five months of no response regarding verification in the Bahamas. Another claimant, Sal Wins, noted that for a claim under $5,000, he was asked to provide extensive income documentation.
“I feel like I’m on trial,” said Sal Wins. “Why is this process so interrogative?”
Market Implications of FTX Payouts
Many in the crypto industry believe that full repayment of FTX claims could inject positive sentiment and liquidity into the market. With nearly 400,000 users still awaiting distributions, the outcome of these repayments may serve as a catalyst for increased market activity in 2025.