FTX’s Two-Year Repayment Delay a ‘Win,’ Says Trader Who Predicted Its Collapse

The much-anticipated creditor repayments from FTX, which are finally being facilitated a little over two years after the crypto exchange’s shocking collapse, are being hailed as a "win" by some in the industry. A crypto trader and marketing executive who accurately predicted FTX's downfall has commented that, considering the complexity of the situation, the repayment process moving forward within two years is a positive outcome.

In a Feb. 28 interview at ETHDenver in Denver, Colorado, Ishan Bhaidani — one of the founders of the crypto marketing firm SCRIB3 — shared his thoughts on the timeline of FTX’s creditor repayments. Bhaidani, who had been among the first to spot red flags at FTX, explained that the complexity of the case, with its multiple jurisdictions and governments involved, made the repayment process much more challenging.

“I thought it would take longer, just because there are so many jurisdictional issues, you're working with so many different governments, different levels of enforcement, different levels of compliance,” Bhaidani said. “You're working with the Bahamas, FTX is multinational… and then obviously the US and a lot of money from US investors, so candidly, I thought it would take longer.”

Given all the challenges, Bhaidani concluded, “I think two years is kind of a win.”

The FTX Collapse and Its Aftermath

The collapse of FTX in November 2022 is considered one of the largest financial scandals in U.S. history. The exchange illegally used customer funds to finance investments through its sister trading firm, Alameda Research. When market conditions worsened, this triggered a liquidity crisis, which left customers unable to withdraw their funds. This ultimately led to FTX filing for Chapter 11 bankruptcy.

As part of the recovery plan, FTX initiated its first round of creditor reimbursements on February 18, 2025. A second round is scheduled for May 30, with creditors needing to verify their claims by April 11.

Under the recovery plan, approximately 98% of creditors are expected to receive at least 118% of their original claim value in cash. For many, this is a welcome development after months of uncertainty.

The Impact of Buying Claims

Bhaidani also offered an interesting perspective on those who purchased claims from FTX creditors. He noted that some investors could have made a significant profit by buying these claims for a fraction of their value.

“If you were taking $0.25 on the dollar and buying Bitcoin at $18,000, $20,000, $30,000 you did pretty well, right?” Bhaidani remarked. “You bought ETH, you didn’t do as well. You bought SOL? You did really, really freaking well.”

These remarks highlight how opportunistic investors who bought claims from FTX creditors could have potentially capitalized on the recovery in the broader crypto market, especially in altcoins like Solana (SOL).

Bhaidani's Early Warning

Bhaidani is well-known for having predicted FTX’s downfall a full month before the exchange imploded. In the interview, he pointed out that several warning signs, including the collapse of the $60 billion Terra Luna ecosystem and former FTX US President Brett Harrison’s departure just before he was set to receive a large payout, should have raised concerns within the company.

“He doesn’t even hit his vest on a $32 billion company… we’re talking about hundreds of millions of dollars in potential equity, why is he leaving without vesting?” Bhaidani asked. “Something has to be wrong in the kitchen over there.”

These observations from Bhaidani only serve to underscore the deep-rooted issues at FTX that many, including Bhaidani himself, had spotted well in advance of the collapse.

Will Sam Bankman-Fried Ever Be Pardoned?

The conversation also touched on the fate of FTX’s former CEO, Sam Bankman-Fried, who is currently facing charges related to the collapse of FTX. Bhaidani was asked about the possibility of Bankman-Fried receiving a pardon for his 25-year prison sentence.

Bhaidani estimated that there is only a 2% to 5% chance that Bankman-Fried could be pardoned, adding that the likelihood is even lower under the current Trump administration.

Conclusion

While FTX’s downfall remains one of the most significant events in crypto history, the process of creditor repayments moving forward has been quicker than many expected, given the complexity of the situation. With a recovery plan that promises to return more than the original claim values to most creditors, it could be seen as a positive outcome for those who were affected.

Bhaidani’s early warnings and his analysis of the repayment process provide valuable insights into the dynamics of the situation, showing that, despite the scale of the disaster, the outcome has not been as dire as initially feared. However, the true long-term impact of the FTX collapse on the crypto industry remains to be seen.