Renewed Payouts to FTX Creditors: Low Point of Crypto Drama Ends in Third Phase of Rescue Plan

The events surrounding the insolvent cryptocurrency exchange FTX are taking an unexpected turn. The FTX Recovery Trust has announced that creditors will soon receive an additional $1.6 billion. This third wave of payments will be distributed to four groups of creditors on September 30 and is expected to cover between 78% and 120% of the original FTX holdings they had during the shocking collapse in November 2022. These payments are part of the comprehensive FTX recovery plan and are being processed through the crypto exchanges Bitgo and Kraken, as well as the payment platform Payoneer. The trust originally presented this plan last year, but the repayment has faced many challenges since then. The formerly incarcerated CEO, Sam Bankman-Fried, made headlines for misusing customer funds for risky speculations through the sister company Alameda Research. This risky handling significantly contributed to the sudden bankruptcy of FTX in 2022 and led to a financial fiasco that eclipsed even the Enron scandal. The legal aftermath led to the arrest and conviction of Bankman-Fried, along with numerous guilty pleas from his closest confidants, including Gary Wang and Caroline Ellison. The criminal activities and misjudgments resulted in a 25-year prison sentence for the former "crypto king.