New York-based NASDAQ OMX Group Inc, in a note to traders on Friday, said it will compensate firms on December 31 for claims related to Facebook Inc.'s botched initial public offering in May 2012.

According to a report by Reuters, NASDAQ previously said it would be paying up to $41.6 million in claims to market participants that lost money due to a glitch in its system. The glitch in NASDAQ's system during the IPO prevented timely order confirmations for many traders. This reportedly left them unsure about their exposure for hours and, in some cases, even days.

NASDAQ said a total of $41.6 million in claims were qualified for compensation. But market participants estimated they lost $500 million collectively, the report said.

Firms that qualified for compensation had until December 23 to agree not to sue NASDAQ over the IPO. The said agreement is required in order to be eligible for a one-time voluntary payout, Reuters said.

NASDAQ was fined $10 million by the US Securities and Exchange Commission for the system glitch, the report said.