Bankrupt crypto exchange FTX has eliminated nearly 400,000 customer requests after users failed to complete identity verification requirements by a court-imposed deadline.
FTX Deletes Nearly 400,000 Unverified Customer Requests Amid Bankruptcy Process
According to documents filed in the U.S. Bankruptcy Court for the District of Delaware, approximately 392,000 customers missed the March 3 deadline to begin the “know your customer” (KYC) process required to verify their claims and recover funds from the platform’s bankruptcy estate.
As a result, FTX has confirmed that these claims have now been fully deleted and dismissed in accordance with court-approved procedures.
This move significantly narrows the pool of eligible creditors as FTX continues its complex bankruptcy proceedings following its collapse in late 2022.
At its peak, the exchange had millions of global users, many of whom were left with frozen balances following the platform’s sudden implosion.
Eliminating these unsubstantiated claims could potentially increase recovery rates for substantiated clients, as the total liabilities against the estate are now significantly reduced.
FTX’s bankruptcy estate is currently in the process of evaluating remaining creditor claims and asset recovery efforts. The estate has reportedly recovered billions of dollars in cash, crypto, and other assets to date and plans to begin distributions in late 2025.
While many verified users are expected to receive partial refunds, the fate of those who missed the KYC deadline has now been sealed as their claims are no longer eligible for any recovery.
*This is not investment advice.
