FTX’s Bahamas Arm to Start Paying Creditors: Is This the End of the Crypto Catastrophe?

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Ah, FTX Digital Markets, the Bahamian branch of the infamous FTX saga, is finally ready to start handing out some cash! Yes, you heard that right. After a spectacular nosedive into the abyss of bankruptcy in November 2022, they’re dusting off their wallets and preparing to repay those poor souls who lost access to their funds. It’s like a financial fairy tale, only with fewer happy endings and more lawyers.

According to a rather optimistic post on X (formerly known as Twitter) by FTX creditor Sunil Kavuri, the repayment extravaganza kicks off on February 18. The lucky “convenience class” creditors—those who claimed under $50,000—can expect to receive a delightful 100% of their adjudicated claim value, plus a sprightly 9% interest per annum since the great collapse of 2022. It’s like finding a forgotten $20 bill in your winter coat, only with a lot more paperwork and existential dread. 💸

The distribution notice was based on a creditor who decided to play it smart and applied for recovery through the crypto firm BitGo. Now, whether Kraken, the other player in this financial circus, will follow suit with the same schedule remains a mystery. If all goes according to plan (and let’s be honest, when does it ever?), FTX could be looking at a payout of over $16 billion. That’s billion with a “B,” folks! 💰

After what feels like an eternity in bankruptcy court, FTX’s debtors finally announced that their reorganization plan took effect on January 3. The first group of creditors is expected to see their funds by early March. So, mark your calendars, folks! It’s like waiting for a bus that’s perpetually late, but this time, it might actually show up.

Final throes of the FTX saga?

Once upon a time, FTX was the belle of the cryptocurrency ball, a shining star in the digital currency universe. But in a dramatic twist worthy of a soap opera, it all came crashing down in November 2022 when the firm reported a liquidity crisis and promptly declared bankruptcy. The then-CEO, Sam “SBF” Bankman-Fried, resigned faster than you can say “Ponzi scheme” and was later sentenced to a staggering 25 years in prison. Talk about a fall from grace! 😱

Kavuri, who has been on this rollercoaster ride for two years, lamented at SBF’s sentencing hearing that he had “suffered” due to FTX’s collapse. Reports suggest he lost more than $2 million. Ouch! That’s a lot of money to lose in a game that was supposed to be fun.

As for the other former FTX and Alameda Research executives, their criminal cases were settled by the end of 2024. Former Alameda CEO Caroline Ellison and former FTX Digital Markets co-CEO Ryan Salame received lengthy sentences, while former FTX engineering director Nishad Singh and co-founder Gary Wang were given time served. It’s like a game of musical chairs, but with prison sentences instead of seats.

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2025-02-04 21:53