FTX Repayments Begin, But Creditors in 26 Countries Face Exclusion

Highlights:

• FTX creditors from restricted countries cannot get their funds due to issues with jurisdiction.
• Creditors must verify claims by April 11 to qualify for the next repayment round scheduled for May.
• The parents of Sam Bankman-Fried are seeking a pardon from President Trump.

FTX began making payments to creditors while maintaining restrictions for specific national jurisdictions. Sunil Kavuri, who acts as an FTX creditor, revealed that the process excludes China, Russia, Nigeria, Egypt, and Ukraine—26 countries in total. FTX has not commented on the matter, though regulatory complications and international payment barriers seem to be key factors. Sunil, however, said that the exchange was reviewing its options.

FTX Claims

A lot of claims are from Jurisdictions not eligible for FTX distributions at the moment which include:

Russia, China, Egypt, Nigeria, Ukraine

FTX is reviewing options

China is the largest with 8% of customers pic.twitter.com/Ts1iToqhAL

— Sunil (FTX Creditor Champion) (@sunil_trades) February 21, 2025

The exchange began its payment process on February 18. FTX is issuing complete reimbursement for funds lost by “Convenience Class” customers who maintained amounts not exceeding $50,000 at a 9% annual interest rate. Several creditors who fall under jurisdictional restrictions remain uncertain when they will receive their funds. Several parties have expressed concerns about the transparency of the repayment procedure.

Upcoming Repayment and Creditor Requirements

The next repayment round is scheduled for May 30. This phase will cover “Class 5 Customer Entitlement Claims” and “Class 6 General Unsecured Claims.” These categories include users who had assets on FTX before its collapse, trading partners, and vendors.

To receive repayment benefits, creditors need to complete the required verification steps. They need to verify their claims by April 11 and choose a distribution agent by the same date. Those with claims exceeding $50,000 will receive their payments in this round.

FTX previously estimated that it owed creditors around $11.2 billion. The platform previously declared that 98% of its debtors would recover 119% of their accepted claim amounts. The 98% claim recovery rate is determined through FTX’s bankruptcy filing approved by Judge John Dorsey in 2022.

The repayment distribution process is being managed by both BitGo and Kraken. The companies will act as intermediaries to guarantee safe distributions of funds to qualified creditors. The majority of payments are moving forward, but creditors located in restricted countries cannot participate in the process for now.

Former FTX CEO’s Parents Seek Clemency for Their Son

Meanwhile, Sam “SBF” Bankman-Fried, the former FTX CEO, faces legal issues. Bloomberg reported in January that his parents sought clemency for him. Its representatives had met with lawyers and people linked to President Donald Trump to explore this possibility.

Bankman-Fried was sentenced to 25 years in prison in March last year. He was convicted of fraud and mismanagement. In addition, Caroline Ellison was sentenced to two years in prison for her role in Alameda Research. Gary Wang avoided prison by cooperating with the authorities. According to reports, Sam’s parents are trying to secure a pardon for him. Bankman-Fried expressed frustration with the Democratic Party and the Biden administration. He had donated to Democrats ahead of the 2020 election.

Major losses were caused by the collapse of the exchange back in 2022. The exchange has since managed to recover between $14.7 billion and $16.5 billion of assets and is now distributing the funds to creditors. As repayment efforts continue, the restrictions in the given countries will complicate the process.