FTX’s $228 Million Win Boosts Customer Payment Schedule
Following its 2022 collapse, FTX has been actively looking for ways to compensate affected investors. The exchange recently reached a major settlement with Bybit, offering hope to its creditors who have been waiting.
FTX and Bybit Reach $228 Million Settlement
According to a legal filing dated October 24, 2024, FTX and Bybit have agreed to a settlement that will allow FTX to recover $228 million after months of litigation. The settlement allows FTX to withdraw $175 million in digital assets from Bybit and sell approximately $53 million in BIT tokens to Mirana Corp, an investment arm of
Previously, FTX had accused Bybit and its affiliates of taking actions that negatively affected the exchange, including hindering asset withdrawals and devaluing its portfolio. While the settlement amount is lower than the $953 million FTX originally sought, the debtors stressed that it restores “essentially everything they sought to recover” and advances ongoing efforts to recover funds for creditors.
Impact on Creditor Payments
The settlement with Bybit is a significant step forward in FTX’s efforts to compensate creditors. FTX CEO John Ray III previously shared that some creditors could receive compensation of up to 118%, with distributions expected to take effect within 60 days of court approval. FTX is currently believed to have more than $16.3 billion available for distribution, which is 50% more than its obligations
Challenges Ahead
While the Bybit settlement is a significant step forward, its implementation is subject to court approval, which is expected to occur on November 20, 2024. Additionally, legal issues involving former FTX executives, such as Caroline Ellison and Sam Bankman-Fried, could also impact the progress of creditor compensation.
Conclusion
The $228 million settlement between FTX and Bybit marks a significant step forward in resolving FTX’s financial obligations to its creditors. However, the implementation of the agreement and the compensation process still need to be closely monitored in the coming time.