Table of Contents
TL;DR,
- The FTX Recovery Trust has withdrawn its plan to block nearly $800 million in FTX creditor payouts to 49 “restricted” nations after facing over 70 legal objections.
- While a victory for creditors, the withdrawal was filed “without prejudice,” meaning the Trust could still refile to restrict payments, urging continued vigilance from claimants.
- As payouts proceed, a new document from SBF’s camp claims FTX was never insolvent, adding a dramatic new twist to the ongoing case.
Three years after what we can call the largest crypto crash since Mt. Gox, FTX creditor payouts could finally happen. The FTX Recovery Trust has formally withdrawn its bid to restrict repayments in 49 “restricted foreign jurisdictions.” Now former investors and organizations in Zimbabwe, Nigeria, and Egypt, alongside dozens of other countries, can look to some repayments after emphatic pleas.
However, celebrating might be presumptuous given the notice was filed “without prejudice,” meaning the Trust has every right to refile a similar request under proper notice and within applicable rules.
Where this leaves the FTX case
The FTX case went down in history as being the fastest liquidated exchange in history, dropping from a billion-dollar valuation within a single month. As expected, their investors, clientele, shareholders, and organizations demanded recuperations; however, $8 billion vanished, plundered on “alternative investment.”
The damage was done, thus leading to the development of the FTX Recovery Trust, an attempt at steadily paying off their debts. With their former CEO locked up for 25 years, their reputation akin to memecoins, and a brand name that effectively became a verb synonymous with crypto scams, the organization funded a loophole. The FTX creditor payout ran into a unique mandate filed in early July 2025 as part of their Chapter 11 plan. The proposal sought a “Restricted Jurisdiction Procedure” in places where crypto rules are deemed unclear or restrictive.
The list of nations mentioned in the Restricted Jurisdiction Procedure.[Photo: X.com]
The exchange listed 49 nations deemed “unfit” for their cross-border asset recovery plan due to their vague regulatory systems. These jurisdictions accounted for 5% of the FTX creditor payouts, approximately $800 million of their $16 billion distributions. Zimbabwe, Egypt, and Nigeria found their way on the listings alongside China, which accounted for 82% of the frozen value.
the FTX Recovery Trust filed a proposal called the “Restricted Jurisdiction Procedure” in places where crypto rules are deemed unclear or restrictive.[Photo: Medium]
Creditor Pushback and Cross-Border Asset Recovery Challenge
Unfortunately, whatever patience FTX clientele had ran out swiftly, with over 70 objections flooding the Delaware bankruptcy court following the motion’s July 2025 submission. This level of organized resistance is rarely seen in bankruptcy proceedings and speaks volumes about the financial stakes FTX once held. It was pure injustice. A group of 300+ Chinese claimants led by Weiwei Ji argued the plan lacked the factual and legal basis to designate China as restricted. Keep in mind China has one of the most progressive crypto ecosystems globally.
FOLLOW UP: The African Crypto Code: Regulating Digital Currency Across Borders
His statement following the withdrawal captured the cautious optimism many creditors now feel:
“This is a victory for all potentially affected creditors. But until you receive the compensation you’re owed, stay vigilant and keep acting together.”
The FTX case had drawn unusually intense scrutiny because forfeiture would have permanently closed the door on recoveries for users in targeted regions. Creditor-representative Sunil Kavuri has warned that distributions could fall short of what some expect, particularly because repayments are being made in fiat rather than cryptocurrency.
Creditor-representative Sunil Kavuri has warned that distributions could fall short of what some expect.[Photo: CNBC]
For those wondering how to claim FTX payouts, the withdrawal of the restricted jurisdiction motion removes one significant barrier. The Trust announced a third distribution of $1.6 billion set for September 30, 2025, with four creditor groups slated to receive between 78% and 120% of the value of their November 2022 holdings, per a press release referenced in the provided materials.
Currently, neither of the African nations has made a move to formally follow up on the recovered funds. However, with the motion withdrawn, it does speak volumes on Africa’s regulatory stance. Nigeria has by far made the most progress with official regulatory frameworks, designated authorities, and a proper tax framework.
SBF’s “never insolvent” claim and the appeal calendar
Alongside the procedural turn, an account used by Sam Bankman-Fried shared a 14‑page document asserting that FTX and Alameda were “never insolvent.” According to the documents, prior to the FTX case, the company had $25 billion in assets plus $16 billion in “FTX equity value” against $13 billion in liabilities. It argued that had the bankruptcy counsel not sold investments, combined holdings could have swelled to an estimated $136 billion.
The document further asserts that FTT could nearly be worth $22 billion today; however, prosecutors say FTT was used to prop up Alameda. With the recent FTX creditor payouts, this new backdrop, and Sam Bankman-Fried’s appeal, attention is again back on the former exchange.
In parallel with asset monetization, the Trust is still pursuing recoveries, including a lawsuit seeking $1.15 billion from Genesis Digital Assets and actions against token issuers NFT Stars and Kurosemi (Delysium) over SAFT agreements.
