Coinbase indicates that FTX reimbursements may result in a $5 billion influx into the market.

Analysts at Coinbase suggest that the $5 billion repayment initiative launched by the FTX Recovery Trust could serve as a substantial liquidity boost for digital asset markets, potentially affecting trading patterns and asset movements as funds are distributed to impacted creditors this week.

The FTX Recovery Trust commenced the distribution of over $5 billion in stablecoins on May 30, initiating a long-anticipated second repayment round for creditors impacted by the collapse of the crypto exchange in 2022.

The disbursement of funds will occur through BitGo and Kraken over a three-day timeframe and will cover a wide array of claimants, including institutional lenders, US customers, digital asset lenders, and general unsecured creditors.

Recovery rates in this round differ by category, with institutional and international claimants receiving 72%, digital asset lenders and general unsecured creditors recovering 61%, and US-based FTX customers obtaining 54%.

Smaller claimants with approved claims below $50,000, categorized as “convenience claims,” are set to recover 120% of the permitted amount.

A recent report from Coinbase indicates that this repayment represents the first significant distribution of stablecoins, which may provide enhanced stability for recipients compared to the February round, which featured a combination of cash and cryptocurrency.

Different market environment

As per Coinbase’s research team, the approach and timing of these repayments could significantly impact the market.

In contrast to the initial February 2025 round, where approximately $7 billion was distributed mainly in cash and crypto, this phase is entirely in stablecoins, offering recipients immediate options for reinvestment.

Analysts propose that this could stimulate new inflows into digital assets, particularly among institutional claimants who are better positioned to quickly redeploy capital. They noted that the February round had minimal effect on digital asset prices due to a lack of market enthusiasm, resulting in the COIN50 index closing the month down 16%.

The report attributed the muted response to macroeconomic challenges, including uncertainties related to tariffs and a scarcity of crypto-specific catalysts.

Nonetheless, the exchange perceives the current environment as more promising. Bitcoin recently reached a new all-time high, institutional interest in crypto treasuries is on the rise, and US lawmakers have made significant strides toward regulatory clarity.

The choice to issue repayments in stablecoins may encourage increased reinvestment in the market, particularly from institutional claimants who now encounter fewer obstacles when reallocating capital.

The FTX recovery process remains one of the largest and most intricate in the history of crypto, involving claims across various jurisdictions and a complex network of counterparties.

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