FTX Bahamas Repayments Begin: A Milestone in Crypto's Darkest Hour

FTX Bahamas repayments to start on Feb. 18

FTX, the once-thriving cryptocurrency exchange, is set to begin repaying its creditors in the Bahamas starting on February 18, 2025. This marks a significant milestone in the aftermath of one of the most notorious bankruptcies in the crypto world.

According to an email sent to creditors, the first wave of reimbursements will start at 10 AM ET on February 18, focusing on claims under $50,000 categorized as "Convenience Class." Eligible creditors will receive 100% of their adjudicated claim value up to $50,000, plus 9% annual interest calculated from November 11, 2022, through the payment date.

The Joint Official Liquidators of FTX Digital Markets confirmed the news, stating that creditors have completed all required steps to be eligible for the distribution. BitGo, a crypto custody platform, will process the payments.

The initial distribution applies only to creditors in the Bahamas liquidation process. Other former FTX users must wait until March 4 for their reimbursements, according to a creditor advocate.

The recovery process has faced legal challenges since FTX's bankruptcy filing in 2022, complicated by the appreciation in value of the lost crypto assets. The 9% post-petition interest addition aims to address financial gaps during the bankruptcy period.

FTX's collapse in 2022 under the leadership of its founder, Sam Bankman-Fried, uncovered corporate mismanagement and fraud. Investigations revealed that the one-time crypto tycoon allegedly orchestrated the scheme, leading to his conviction on multiple criminal charges and a 25-year prison sentence.

Analysts estimate that FTX's collapse created a $16 billion shortfall. Reorganization administrators, led by bankruptcy CEO John J. Ray III, anticipate that asset recovery efforts could extend until 2027.

Meanwhile, Bankman-Fried's former inner circle, such as former Alameda Research CEO Caroline Ellison, received lighter sentences and forfeited wealth gained while working for FTX.

FTX's repayments to Bahamas creditors mark a crucial step in the recovery process, signaling a potential turning