#United States #Bankruptcy #Wilmington #FTX Recovery Trust #Creditors

FTX Recovery Trust's Major Distribution Event

On May 30, 2025, the FTX Recovery Trust is poised to make significant financial distributions to creditors, totaling over $5 billion. This event follows the guidelines outlined in FTX's Chapter 11 Plan of Reorganization and marks the second distribution phase, aiming to fulfill financial obligations to creditors effectively.

FTX Trading Ltd., operating as FTX.com, has collaborated closely with the FTX Recovery Trust to ensure a streamlined distribution process to those with approved claims under the plan. Creditor eligibility hinges on the completion of pre-distribution requirements, which include onboarding with designated distribution service providers, either Bitgo or Kraken. Once these steps are finalized, creditors can expect funds to be transferred within one to three business days from the distribution date.

Distribution Breakdown

The distribution will prioritize allowed claims in various classes as dictated by the established waterfall structure:

• - Allowed Class 5A Dotcom Customer Entitlement Claims will receive a 72% distribution.
• - Allowed Class 5B U.S. Customer Entitlement Claims will receive a 54% distribution.
• - Both Allowed Classes 6A General Unsecured Claims and 6B Digital Asset Loan Claims are set to receive a 61% distribution.
• - Notably, Allowed Class 7 Convenience Claims will see a remarkable 120% distribution.

John J. Ray III, the Plan Administrator of the FTX Recovery Trust, remarked on the importance of these distributions, stating, "This event is a pivotal milestone for FTX. The extensive nature of the creditor base makes this process unprecedented. Our team's efforts in recovery and coordination have paved the way for this significant advancement. We are continually focused on maximizing recoveries for all creditors."

Procedures for Creditor Participation

To be eligible for further distributions, creditors must follow specific steps before the upcoming record date. These include:
1. Logging into the FTX Customer Portal (https://claims.ftx.com).
2. Completing the requisite Know Your Customer (KYC) verification.
3. Submitting the necessary tax documentation.
4. Onboarding with either BitGo or Kraken, the approved distribution service providers.

For claims that have been transferred, distributions will be directed solely to the transferee of an allowed claim, provided it has been duly recorded by the Notice and Claims Agent and there has been no objection within the 21-day notice period preceding future record dates.

Caution Against Phishing Attempts

In light of the looming distribution event, FTX urges creditors to remain vigilant about potential phishing attacks. Malicious emails or websites mimicking FTX communications could attempt to compromise sensitive information. It is vital to remember that FTX will never request clients to connect their wallets directly to third-party platforms.

Further Information

Comprehensive information regarding the court filings, including the distribution plan and other related documentation, is accessible at Kroll's official site. Those under the administration of FTX Digital Markets Ltd. will receive tailored communications regarding their claims and distribution processes.

The FTX Recovery Trust works with a team of esteemed advisors, including Sullivan & Cromwell LLP for legal counsel and Alvarez & Marsal North America, LLC for financial guidance, underscoring the diligent collaboration aimed at achieving equitable resolutions for all parties involved.

In summary, the upcoming distribution scheduled for May 30, 2025, signifies a historic moment for FTX and its creditors as they navigate the recovery process. As distributions commence, the attention will shift towards recovery efforts to ensure the best possible outcomes for all affected stakeholders.