FTX's 'Waterfall' Payouts Hit $1.6B Milestone in Crypto Bankruptcy

FTX Trading Ltd. and the FTX Recovery Trust announced on Sept. 19, 2025, that they will distribute approximately $1.6 billion to creditors on Sept. 30, 2025, as part of the third disbursement under the Chapter 11 Plan of Reorganization. This payment follows two prior distributions totaling over $6 billion, with the latest round further advancing the liquidation of the bankrupt crypto exchange’s $16.5 billion estate. Eligible creditors who have completed Know Your Customer (KYC) verification and onboarded with BitGo, Kraken, or Payoneer will receive funds within one to three business days of the payout date.

The distribution adheres to the “waterfall” priority structure outlined in the reorganization plan. Allowed Class 5A Dotcom Customer Entitlement Claims will receive an incremental 6% distribution, raising their cumulative recovery to 78%. U.S. Customer Entitlement Claims (Class 5B) will get a 40% payout, bringing their total recovery to 95%. General Unsecured Claims (Class 6A) and Digital Asset Loan Claims (Class 6B) each receive 24%, pushing their cumulative recovery to 85%. Convenience Claims (Class 7), which include smaller claims, will be fully reimbursed at 120% of their face valueFTX Recovery Trust to Distribute Approximately $1.6 Billion to Creditors in Third Distribution on September 30, 2025^[1].

Creditors must fulfill pre-distribution requirements to qualify, including submitting tax forms and onboarding with one of the designated distribution service providers. Transferred claims will only be processed for transferee holders reflected on the official claims register after a 21-day objection periodFTX Recovery Trust to distribute ~$1.6B in September payout^[2]. The Recovery Trust emphasized that no wallet connections are required for eligibility, addressing concerns about potential fraud in the bankruptcy process.

The third distribution marks continued progress in one of the crypto industry’s largest bankruptcy cases. The collapse of FTX in November 2022, triggered by revelations of misused customer deposits, sent shockwaves through the crypto market and deepened the bear market. The Recovery Trust, advised by Sullivan & Cromwell, Alvarez & Marsal, and Perella Weinberg, has prioritized asset liquidation and litigation to return funds to creditors. Previous distributions in February and May 2024 returned $1.2 billion and $5 billion, respectivelyFTX Recovery Trust Unlocks $1.6B for Creditors This Month^[3].

Future distribution dates will depend on additional funds recovered or claims processed. The Recovery Trust has retained approximately $1.6 billion in assets earmarked for creditors, with subsequent payments contingent on ongoing legal and administrative costs. The latest round of disbursements underscores the structured approach to repaying victims of FTX’s collapse, which has seen its founder, Sam Bankman-Fried, sentenced to 25 years in prison for fraud and conspiracyFTX News: Bankrupt Crypto Exchange to Repay $1.6B on Sep. 30 …^[4].