FTX Crypto Fraud Victims to Receive Full Restitution — Plus Interest

FTX Crypto Fraud Victims to Receive Full Restitution — Plus Interest

In a remarkable turn of events, bankruptcy lawyers representing customers affected by the catastrophic collapse of the cryptocurrency exchange FTX, 17 months ago, have announced that the vast majority of victims will receive their money back — with added interest.

Background: A Tumultuous Legal Battle

This development follows six months after FTX's co-founder and former CEO, Sam Bankman-Fried (SBF), was convicted on seven counts of fraud, conspiracy, and money laundering. Approximately $8 billion of customers’ funds had disappeared. In March, SBF was sentenced to 25 years in prison and ordered to pay $11 billion in forfeiture. He has since filed an appeal, which is expected to be a prolonged process.

The Restructuring Phase

After FTX declared bankruptcy in late 2022, SBF stepped down, and U.S. attorney John J. Ray III assumed the role of CEO and chief restructuring officer, responsible for steering the reorganization of FTX. In his initial testimony, Ray expressed skepticism about the reliability of any previous audits conducted by FTX, stating that he didn’t “trust a single piece of paper in this organization.”

Reclaiming Lost Assets

At first, it seemed implausible that investors would recover much, if any, of their money. However, recent developments indicated a more positive outlook, with progress on recovering cash from various investments FTX had made, as well as from executives involved with the company.

The Road Ahead: Cash Distribution

In total, FTX plans to disburse between $14.5 billion and $16.3 billion in cash. These funds include assets controlled by entities such as Chapter 11 debtors, liquidators, the Securities Commission of the Bahamas, and the U.S. Department of Justice, among other parties.

A Noteworthy Caveat: Bitcoin and Ethereum Shortfall

It is essential to note that creditors will not benefit from the Bitcoin boom that the crypto industry has experienced since FTX’s downfall. At the time of its bankruptcy filing, FTX had a significant shortfall in Bitcoin and Ethereum — much less than customers believed it owned. Accordingly, the appreciation in value of these tokens will not be realized as part of this settlement.


As restructuring efforts continue, this new development represents a significant milestone for FTX creditors, who can now look forward to not only recovering their investments but also receiving compensation for the time their assets were tied up. This positive turn offers a glimmer of hope and justice in a saga marked by significant financial turmoil.

John J. Ray III's Initial Testimony

I didn’t trust a single piece of paper in this organization.

John J. Ray III

Today, a press release from the FTX estate revealed that 98% of FTX creditors would receive 118% of the value of their FTX-stored assets in cash. The remaining creditors will receive 100% of their funds, along with “billions in compensation for the time value of their investments.”

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Originally from Dakar, Senegal, Isabelle is a business writer with a flair for storytelling. She covers cryptocurrency markets, focusing on startups and new technologies in the blockchain space. Isabelle has an MBA and blends her business acumen with a passion for crypto.