- FTX creditors are getting billions in payouts but rising crypto prices mean their real coin value remains far lower.
- Despite $7B in recoveries, many FTX creditors feel shortchanged since repayments are tied to 2022’s lower crypto prices.
- The recovery process shows progress, but real crypto returns reveal how timing and valuation shape true repayment fairness.
FTX’s long-running bankruptcy case has reached a critical stage as creditors question repayment fairness amid rising crypto prices. The exchange’s recovery team continues to distribute billions, yet real crypto values tell a different story. According to Sunil, an FTX creditor representative on X, repayment figures in fiat terms overstate the actual recovery when measured against today’s crypto prices.
Sunil explained that Bitcoin’s petition price was $16,871 compared to over $110,000 currently, meaning a 143% fiat payout equals only 22% in real BTC value. Similarly, Ethereum’s recovery represents 46%, while Solana’s equates to just 12%. “FTX creditors are not whole 9% to 46%,” he said, stressing that actual crypto value remains significantly lower.
Recovery Efforts and Asset Liquidations
In May, the FTX Recovery Trust completed its second $5 billion payout covering multiple claim categories. Dotcom Customer Entitlement Claims received 72%, U.S. Customer Claims 54%, and Convenience Claims 120%. General Unsecured and Digital Asset Loan Claims will receive 61%, with funds released through Kraken and BitGo. Additionally, another $1.6 billion distribution is planned, pushing total repayments above $7 billion.
Moreover, the recovery team has sold tech investments, reclaimed funds from third parties, and liquidated corporate assets tied to FTX and Alameda Research. These actions have allowed the estate to deliver one of the highest recovery rates seen in crypto bankruptcies.
Legal Challenges and Valuation Disputes
Former CEO Sam Bankman-Fried, serving a 25-year prison term, is appealing his conviction before the U.S. Court of Appeals on November 4. His lawyers argue that prosecutors mishandled FTX’s case and that he was “never presumed innocent.”
However, creditors remain frustrated by how courts value claims using November 2022 prices, when Bitcoin and Ether were significantly lower. Consequently, while payouts look large in fiat, they fall short in crypto terms. Courts have upheld this valuation as consistent with bankruptcy law.
