Eligible customers and non-customer creditors can log on to the website to submit relevant information to make claims, which involves a total of 5 steps.

Article author: Jordan

Source: PWC

After a long wait, FTX joint official liquidator (JOL) PwC updated the liquidation claims process and announced the launch of the FTX Digital Markets (the main regulatory and licensing entity of the FTX international platform) claims portal.

According to the disclosed information, FTX will notify eligible customers and non-customer creditors to submit information such as proof of claim through the FTX Digital Markets Claims Portal, and only customers and non-customer creditors who submit electronic claims before the prescribed deadline of May 15, 2024, and the relevant information is recognized, will be eligible to receive liquidation claim funds distribution in the Bahamas procedure.

FTX Liquidation Claim Timeline

Before we start exploring how to file an FTX liquidation claim, let’s take a look at the timeline of the incident:

On November 10, 2022, the Securities Commission of the Bahamas filed a liquidation petition with the Commercial Court of the Supreme Court of the Bahamas against FTX Digital Markets Ltd. and suspended its license to operate as a digital asset business. On the same day, the liquidation proceedings for FTX Digital were officially initiated.

On November 14, 2022, Kevin Cambridge of PwC Bahamas and Peter Greaves of PwC Hong Kong were also appointed as provisional liquidators by the Supreme Court of the Bahamas.

On February 15, 2023, the U.S. Bankruptcy Court for the District of Delaware recognized the Bahamas' main provisional liquidation proceedings.

On November 10, 2023, after hearing evidence presented by representatives of the Securities Commission of the Bahamas, the Joint Provisional Liquidators and counsel representing FTX Trading Ltd., the Supreme Court of the Bahamas appointed the Joint Provisional Liquidators as Joint Official Liquidators (JOL) and ordered the liquidation of FTX in accordance with the provisions of the Companies Act 1992 (as amended) and the Companies (Winding-up Amendment) Act 2011 applicable to the liquidation of international business companies.

On March 3, 2024, the FTX claims portal was officially launched. Eligible customers and non-customer creditors must submit proof of debt to apply for claims on May 15, 2024.

FTX Liquidation Claim Guide

As the joint official liquidator of FTX, PwC has now officially launched the FTX Digital Markets claims portal, where eligible customers and non-customer creditors can log in to submit relevant information for claims. There are a total of 5 steps involved, as follows:

1. Account Registration - Create a Claims Portal Account

In order to submit a claim, you first need to create an account on the FTX claims portal, which will allow you to link your FTX account, view your account balance, and submit liquidation claims. (Note: Users in Australia, Europe, Turkey, or Japan may be processed according to one of the separate processes.)

As required by FTX, creating an account requires providing contact information and details (including name, phone number and email address, date of birth and account opening date, as shown above), as well as the type of claimant (including individual customers, institutional customers and non-customer creditors, as shown below).

It should be noted here that individual customers refer to customers who file claims against "FTX.com" or "FTX International" in their personal name; institutional customers refer to customers who file claims against "FTX.com" or "FTX International" in the name of the company; non-customer creditors refer to trading creditors who provide goods or services to FTX Digital (a small number of employees may fall into this category). The registration information for these three types is not the same, as shown in the figure below:

After successfully completing all the above information, click the "Next" button and you will see a pop-up window stating that an email with a "One-time PIN" has been sent. You need to enter the password on the next page (as shown below). If you do not receive the email, please check your spam folder or you can click "Resend verification email".

2. Register creditors and customer account details

To submit a claim, you will also need to fill out additional details to register yourself as a creditor and link your FTX account to the FTX Digital claims portal account you just created. Once your FTX account is linked to the FTX Digital claims portal account, you can submit a claim for your FTX account and view the associated account balance, after which you can choose to accept the balance figure, or dispute the balance figure and provide further details to substantiate the amount of the claim funds.

After setting up your FTX Digital claims portal account, you can log in at any time using your username and password (as shown above), but you will need to receive another email containing a "one-time PIN". In fact, every time you log in to the claims website, you will need to obtain a "one-time PIN" via email to ensure the security of your account.

Once you have logged in, you will be directed to the Creditor and Customer Account Details Registration section and will be required to provide the following details:

Step 1: “Current Claimant Information” – Complete all required fields (Name, Date of Birth, Phone Number, Address, Country of Residence, Occupation, Nationality, ID Number)

NOTE: Acceptable/recommended ID numbers are passport, national ID card and/or driver's license numbers, depending on the jurisdiction.

Step 2: Link your FTX account. Enter your FTX account’s email address. This will link your FTX account to an FTX Digital Claims Portal account. Once you’ve entered your email address, a verification code will be sent to your linked email address to verify your access to these accounts.

Once you have successfully linked your FTX account, you will be able to view your balance information for review.

3. Balance Acceptance – Accept or dispute the listed balance

After completing the FTX account linking, you will be directed to the balance page, which displays the portfolio information and balance data of the related accounts in detail, as shown below:

At this point, you can choose to accept or question the balance number in the lower right corner of the page and enter the following page:

If you dispute the balance (i.e. Dispute Portfolio), you will need to provide more details to substantiate the claim amount -

Section 1 (below) - Customer/Non-Customer Details, enter your full name, primary residential address, primary contact phone number, and email address (the one associated with your FTX account).

Section 2 - Claim Amount (USD or USD equivalent) requires you to enter the details of the claim amount.

Part 3 - Basis of claim. You must provide detailed reasons for the claim amount and attach relevant supporting documents to verify the claim funds. Uploaded files support image (e.g. jpeg, png), PDF, Word or Excel (including CSV) formats, but email uploads (e.g. .msg format files) are not accepted. If an email is involved, it must be saved as a PDF file and uploaded.

Section 4 - Claims acquired/transferred, if FTX assets were purchased from another party, please indicate that information.

Section 5 - Security, if any security (i.e. mortgage, charge or other collateral) is held in connection with the claim.

After completing the above steps, or directly confirming the acceptance of the claim amount, the user will be directed to the dashboard page, which will confirm the claim amount and ask to submit the information. Once the name, identity, contact information is entered and signed, and the claim information is submitted, it cannot be modified.

4. Authentication

The Joint Official Liquidators will carry out Anti-Money Laundering (AML) and Know Your Customer (KYC) procedures to confirm that creditors have legal rights to their accounts and help prevent fraudulent activity.

As part of the KYC process, customers and non-customer creditors are required to submit identification information and supporting documentation for review, which helps confirm creditor identities and accounts and enhances the security of FTX Digital’s claims process. Completing the KYC process is not the only factor in determining whether a claim can be paid, as there may be external restrictions on sending distribution funds in certain jurisdictions.

Since this step is operated in the "backstage" by FTX and the official liquidator, the claimant does not need to take any action and will be notified by email once the identity verification is completed.

5. Liquidation and transfer of claim assets

Once the above process is completed, FTX Digital's claims will enter the formal adjudication process, creditors will receive the results of the adjudication, and the payment of the first interim dividend distribution is expected to be paid at the end of 2024 or the beginning of 2025.

Safety reminder

When submitting relevant information, you must pay attention to the official website address information to prevent phishing and spam fraud. FTX creditors need to confirm the authenticity of the email information received and the legitimacy of the relevant emails. If necessary, they can communicate through the email address on the official website and confirm the relevant information.