FTX Pays Back Creditors: Big Wins After 2-Year Crypto Collapse!

FTX Begins Creditor Repayments After Two Years of Legal Delays

FTX, the collapsed cryptocurrency exchange, has officially started repaying its creditors after more than two years of legal battles and complex jurisdictional issues. The first round of reimbursements took place on February 18, 2025, while the second round is scheduled for May 30, 2025. Under FTX’s recovery plan, 98% of creditors will receive at least 118% of their claim value in cash, making it one of the most significant repayments in financial history.

Why Did the Repayment Take So Long?

FTX’s bankruptcy was one of the biggest financial fraud cases in U.S. history. The exchange, led by Sam Bankman-Fried (SBF), collapsed in November 2022 after it was revealed that customer funds were illegally used to support its sister company, Alameda Research. This misuse of funds led to a liquidity crisis, preventing users from withdrawing their money.

Recovering these funds was not easy. The repayment process took over two years due to legal complications involving multiple governments, including the Bahamas, the United States, and other regions where FTX operated. The legal teams had to track down assets, liquidate holdings, and ensure fair distribution to creditors.

A Crypto Trader Predicted FTX’s Collapse

Interestingly, crypto trader and marketing executive Ishan Bhaidani was among the first to warn about FTX’s troubles. In October 2022, a month before the exchange collapsed, he posted a series of messages online, claiming that something “shady” was happening at FTX.

He pointed out red flags, such as the sudden departure of FTX US President Brett Harrison, who left without waiting for his stock to vest—an unusual move for an executive at a company valued at $32 billion. Bhaidani’s predictions turned out to be correct, as FTX soon collapsed, leaving investors in shock.

Looking back at the repayment process, Bhaidani believes the two-year wait was a “win” considering the complexities involved.

“I thought it would take longer, just because there are so many jurisdictional issues—you’re working with multiple governments, different levels of enforcement, and varying compliance standards,” Bhaidani told Cointelegraph’s Turner Wright in a Feb. 28 interview at ETHDenver in Denver, Colorado.

“You’re dealing with the Bahamas, FTX is multinational, and then obviously the U.S., where a lot of money from U.S. investors was involved. So, candidly, I thought it would take even longer,” he added.

How Investors Are Affected

FTX’s bankruptcy created a secondary market for creditor claims. Some investors bought these claims at a fraction of their value, hoping to profit when reimbursements were made. Their success depended on how they reinvested their funds.

Conclusion: A Step Toward Recovery

FTX’s repayments are finally bringing relief to creditors after two years of waiting. While the delay was long, most creditors are getting back more than they lost, which is a positive outcome. This situation reminds investors to be careful and research before investing in crypto. As payouts continue, people will keep an eye on the market and hope for better security in the future.