- FTX distribution rumors for October 1 have been debunked; hearings are set for October 7.
- Full recovery for FTX creditors may take 2-3 years.
- Claims under $50,000 could see repayment by the end of 2024.
As bankrupt crypto exchange FTX gears up for its $16 billion payout in Q4 2024, rumors are mounting that its distribution date could be as early as October 1, 2024. The upcoming release of these funds could significantly impact the crypto market. However, Sunil, an FTX creditor champion, clarified that claims of the inflow and distribution beginning on October 1 are false. Instead, a plan hearing is scheduled for October 7, with the repayment process likely stretching over the next two to three years.
According to Sunil, an estimated $5.5 billion in claims have been bought, with 50% of those claims not coming from crypto investors, meaning that these holders are unlikely to reinvest in the crypto market. The update also hints at a possible timeline for distribution. Claims under $50,000 could see resolution by the end of 2024, while larger claims above $50,000 are projected to receive between 70% to 100% of their petition date value.
For claimants holding more than $50,000, Sunil indicated that if the recovery hits 100%, it would result in a $5.5 billion recovery for both claim buyers and original holders. However, for those hoping for immediate relief, the process will take time, with the remaining recovery expected to unfold over the next two to three years.
FTT Price Surges on FTX Payout Rumors
Meanwhile, FTX’s native token, FTT, has seen a rollercoaster in price action. Despite a slight dip, FTT remains the top gainer on CoinMarketCap with a 60% surge in value within the last 24 hours, currently sitting at $2.31.
The defunct exchange’s highly anticipated fund release is seen in positive light, with many calling it a “bullish” indicator that benefits existing investors and may also attract new institutional participants. Now that the rumors of an immediate payout are debunked, FTX creditors should temper their expectations as repayment and distribution are not set to begin on October 1. With plan hearings scheduled for October 7, it could take up to three years for full recovery.
