FTX Bans Payouts in 49 Countries—China’s Crypto Dream Turns into Kafkaesque Farce 🤯

by
  • FTX Recovery Trust freezes handouts in 49 nations, citing legal tomfoolery.
  • China sports a grand 82% of these doomed claims—a mere 5% of $16B, but who’s counting?
  • Complain within 45 days, or say goodbye to your magical internet money.

Picture an overstuffed courtroom, presumably lit by a single, flickering bulb, crowded with bleary-eyed creditors brandishing affidavits in the futile hope that they may salvage a few bitcoins from the flames. The FTX Recovery Trust, haunted by nebulous laws and the ghosts of bad investments, has put a most formidable block on creditor payouts across 49 jurisdictions. The wretched lot includes China, Russia, and Pakistan—places where cryptocurrency, apparently, is viewed with the same suspicion as Western jazz or a decent martini.

Legal Barriers Block FTX Payouts

Source –X

For those who poured their hopes (and pecuniary resources) into FTX, local legal eccentricities now stand between them and their cosmic reward. Instead, their claims must languish in a legal limbo, much like an Oxford undergrad waiting for a letter from the Provost. The Trust estimates these jurisdictions represent a trifling 5% of the total $16 billion quantum, but with China clutching 82% of the restricted value—one imagines the committee meetings resound with quiet weeping and frantic tea consumption.

A missive known as a “Restricted Jurisdiction Notice” is to be ceremoniously delivered to each creditor, illuminating for them the splendid reasons for their financial purgatory. Recipients have a theatrical 45 days to object, assuming, of course, they’re willing to file a sworn statement, submit to the jurisdiction of a U.S. court, and possibly navigate a corn maze. Should they fail—quite likely, all things considered—their unclaimed bounty returns, unloved, to the Trust for redistribution. Sic transit gloria pecunia.

Local counsel (finer Latin than the lawyers themselves, no doubt) will be summoned in each locality to consider whether a payout might, in fact, be possible. On July 22, the court will convene—presumably hoping for both shade and clarity—and determine if this farcical arrangement will go ahead.

Creditor Challenges and Options

Source –X

Somewhere in China, an accountant weeps and a lawyer orders another lunch. Creditors, whose claims now read more like tragic literature than legal paperwork, stare down legal procedures that require Olympic-level stamina—sworn affidavits, compulsory confessions, and, ultimately, deference to American jurisprudence. Many seek to offload their claims through intermediaries in “recognized” lands, a gambit with all the success of an Englishman ordering Peking duck in Andover.

Since February 2025, FTX Recovery Trust—bless its cheery optimism—has managed to dish out $6.2 billion across two rounds, as if trying to convince the world that crypto is less Ponzi, more angels-on-pinheads. The Trust partnered with Payoneer in a dazzling global dance that includes 93 jurisdictions—so very inclusive, if only 49 weren’t out in the drizzle.

The ignoble collapse of the $32 billion FTX empire in 2022, propelled by that fleet-footed chap Sam Bankman-Fried (now reconsidering career options for the next 25 years), prompted a scramble for restitution. Creative solutions like flogging investments in companies with names resembling Grecian philosophers have aided some payouts, though for many, the end of the tunnel is marked ‘No Entry’.

Yet, hope springs eternal—or at least until the next court hearing. Legal minds now hover over the prospect of shrinking the blacklist and letting more creditors nibble at what’s left of the feast. Eager eyes, with the slightly deranged gleam common to all bankruptcy sufferers, await the coming court decision. Vive la financial absurdity!

Read More

2025-07-05 12:10