"FTX's 'Waterfall' Payout: U.S. Creditors Near Full Recovery, Global Claimants Lag"

The FTX Recovery Trust will distribute approximately $1.6 billion to creditors on September 30, 2025, marking the third major disbursement under the Chapter 11 Plan of Reorganization. This payout, routed through BitGo, Kraken, or Payoneer, will reach eligible claimants within one to three business days following the distribution date. The allocation follows a “waterfall” priority structure, with higher-priority classes receiving larger shares of the funds. Allowed Class 5B U.S. Customer Entitlement Claims will receive 40% of their outstanding balances, bringing cumulative recoveries to 95%. Dotcom Customer Entitlement Claims (Class 5A) will see an incremental 6% distribution, raising their total to 78%, while General Unsecured Claims and Digital Asset Loan Claims (Classes 6A and 6B) will each receive 24%, pushing cumulative recovery rates to 85%. Convenience Claims (Class 7) will be fully reimbursed at 120%, exceeding the face value of claimsFTX Recovery Trust to Distribute Approximately $1.6 Billion to Creditors in Third Distribution on September 30, 2025^[1].

The distribution reflects progress in the broader recovery effort, which has already returned over $6 billion to creditors since February 2025. Previous payouts included a $1.2 billion disbursement in February 2025 and a $5 billion round in May 2025, with the latter including 9% interest for smaller creditors. The cumulative recovery rates highlight the structured approach to repaying victims of FTX’s 2022 collapse, which triggered one of the largest bankruptcies in crypto history. The current disbursement further advances the goal of returning up to $16.5 billion in assets to stakeholdersFTX Recovery Trust to Distribute ~$1.6B in September Payout^[4].

Eligible creditors must complete verification steps before receiving funds, including Know Your Customer (KYC) checks, submission of tax forms, and onboarding with a designated Distribution Service Provider. The FTX Recovery Trust emphasized that no wallet connections are required, warning against phishing scams targeting users. Transferred claims will only be distributed to transferees confirmed on the official claims register after a 21-day notice periodFTX Recovery Trust to Distribute Approximately $1.6 Billion to Creditors in Third Distribution on September 30, 2025^[1].

The recovery process is overseen by legal and financial advisors, including Sullivan & Cromwell LLP and Alvarez & Marsal North America, LLC. U.S. Bankruptcy Court filings, including the Plan and related documents, are accessible via the court’s portalFTX Recovery Trust to Distribute Approximately $1.6 Billion to Creditors in Third Distribution on September 30, 2025^[1]. The third distribution underscores the ongoing efforts to resolve the bankruptcy estate, though future payouts will depend on additional asset recoveries and claims processingFTX Recovery Trust to Distribute ~$1.6B in September Payout^[4].

Analysts note that the disbursement could influence crypto market volatility in the short term, as liquidity returns to creditors. However, the structured, multi-year repayment plan has already restored significant portions of claims, particularly for U.S. customers. The cumulative 95% recovery rate for U.S. customers, compared to 78% for international users, reflects the prioritization of domestic claims under the reorganization frameworkFTX Announces 3rd Fund Distribution on Sep 30 Involving $1.6B^[2].