Crypto Market Eyes Upside as FTX Set to Repay $1.6B to Customers

The estate of the defunct crypto exchange FTX has revealed plans to distribute billions of dollars as part of repayments to creditors. This has sparked bullish sentiments, considering that it could inject fresh liquidity into the crypto market, leading to higher prices.

Crypto Market Gets Lift As FTX Plans To Distribute $1.6 Billion

In a press release, the defunct crypto exchange’s estate announced that it will distribute almost $1.6 billion to creditors on September 30 as part of the Chapter 11 Plan of Reorganization. The Recovery Trust will distribute this sum to holders of allowed claims in the Plan’s Convenience and Non-Convenience Classes that have completed the pre-distribution requirements.

This will mark the third FTX repayment following earlier distributions in February and May. Eligible creditors will receive their funds either through Kraken, Bitgo, or Payoneer. The Recovery Trust stated that it will announce subsequent record and payment dates in due course.

The $1.6 billion repayment could inject fresh liquidity into the crypto market and give crypto prices a lift, especially with the market still trading sideways despite the Fed making a rate cut earlier this week.

“FTX Creditor Champion” Sunil confirmed the upcoming repayment in an X post. He stated that claims above $50,000 will receive 6%, while U.S. claims will receive 40% and claims below $50,000 will receive 120%. He noted that this is in addition to the $1.9 billion from the disputed reserve.

Crypto Market On Another Downtrend

The crypto market is currently on the decline amid the announcement of the third FTX repayment. TradingView data shows that the total crypto market cap is down almost 2% in the last 24 hours, dropping below the $4 trillion mark in the process.

The Bitcoin price has led this decline, with the flagship crypto down almost 2% in the last 24 hours, currently trading at around $15,300 and at risk of dropping below the psychological $115,000 level.

Crypto analyst Titan of Crypto noted that just like last week, BTC still needs to reclaim the Tenkan at around $115,500, which is currently acting as resistance on the weekly timeframe.

The flagship crypto is also facing resistance on the daily timeframe. The analyst stated that BTC remains stuck below the bearish fair value gap at around $117,000. He added that a daily close above it would open the way for further upside.