FTX has confirmed Payoneer as a third repayment channel – alongside BitGo and Kraken – effective for distributions after May 30, 2025. The integration expands reach to around 93 countries, including India, Indonesia, Japan, and US states like New York, Washington, and Maine. However, crucial markets – China, Nigeria, Russia, Egypt – remain excluded from receiving repayments via Payoneer (or the other channels).

In a July 2 2025 filing, the FTX Recovery Trust asked the Delaware bankruptcy court for legal authority to freeze distributions to creditors residing in 49 jurisdictions (e.g., China, Nigeria, Russia, Andorra, Zimbabwe) until local legal opinions confirm compliance.

Affected claims amount to roughly 5% of total allowed claims, with China alone accounting for a whopping 82% of that frozen value.

How FTX Drew Over 100,000 African Customers Onto its Platform

FTX lured customers from Africa to use its platform by promising that Africans could use stablecoins to protect their wealth from devaluation, according to a new Wall Street Journal reporthttps://t.co/QA1cCsKzeh pic.twitter.com/7xHpwg9YMd

— BitKE (@BitcoinKE) March 1, 2023

Why This Matters

  • Legal caution vs. creditor equity: FTX worries that distributing funds in jurisdictions with bans or unclear crypto regulations could result in legal penalties – even criminal liabilities – for directors and officers.

  • Impact on non-US creditors: Creditors in frozen regions must either wait for possible legal clearance or formally contest via sworn declarations and acceptance of U.S court jurisdiction. Objections are time‑sensitive: a 45‑day window is set after notice is served. Failure to object could result in forfeiture of claims and associated interest, reverting funds to the Trust.

  • Creditor backlash growing: Many affected, especially Chinese creditors, are vocalizing plans to challenge the freeze and are demanding more transparency.

  • Historic precedence: Past bankruptcies like Mt. Gox saw foreign claimants selling or assigning claims due to legal barriers – FTX’s reliance on fiat distributions mirrors these constraints.

  • Global regulatory patchwork: Crypto legality varies dramatically – China bans transactions, not holding. Meanwhile, jurisdictions like Hong Kong permit crypto‑derivative trading. This disparity drives FTX’s cautious “hold‑and‑review” procedure.

What’s Next

Event Impact Court hearing Expected in July 2025 to decide approval for restricted‑jurisdiction protocol Legal outcomes Local counsel will assess where payouts can legally proceed across the 49 jurisdictions Creditor actions Affected claimants can file objections within 45 days of service; failure means automatic forfeiture

 

What to Watch

  • Local jurisdiction rulings: Will countries like China or Nigeria gain clearance or remain off‑limits?

  • Creditor legal challenges: Will mass objections force re-evaluation?

  • Trust transparency: Are the keep-or-freeze decisions consistent and communicated fairly?

 

Final Thoughts

FTX is navigating a legal tightrope – balancing global creditor repayment obligations with the regulatory minefield of crypto bans. The introduction of Payoneer signifies progress, but the continuing exclusion of major markets and the sweeping freeze across 49 jurisdictions highlight the inequalities shaping crypto’s post-bankruptcy reality.

While retail debtors in eligible regions may receive their full entitlements, others – most notably in China and Nigeria – must endure delays, complex court procedures, and potentially permanent loss of reclamation rights. The outcome could set a significant precedent for how future crypto bankruptcies handle cross-border asset recovery.

 

 

 

Stay tuned to BitKE for deeper insights into the evolving global crypto space.

Join our WhatsApp channel here.

Follow us on X for the latest posts and updates

Join and interact with our Telegram community

________________________________________________

#BTC