FTX Crypto Exchange Litigation Begins in US
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On Tuesday, November 22, the Delaware Bankruptcy Court held its first hearing in the case of the collapsed cryptocurrency exchange FTX. Lawyers and representatives of the new management of the exchange once again repeated the thesis about the ugly business of the company’s founder Sam Bankman-Freed, and also disclosed data on the volume of embezzlement and theft. According to them, a “substantial portion” of the assets of the cryptocurrency exchange, which filed for bankruptcy on November 11, “has either been stolen or gone.”
Reuters previously reported that Sam Bankman-Fried used FTX Group funds to buy luxury real estate in the Bahamas, where the company was registered. In addition, lawyers have reported an exodus of FTX employees. Back in October, the company’s staff, taking into account its business abroad, was 520 people. Now, according to Mr. Bromley, there are “about 260” left.
FTX Group, operator of the Bahamas-listed cryptocurrency exchange FTX, filed for bankruptcy on November 11. At the same time, Sam Bankman-Fried’s departure as CEO was announced, and the company itself came under external management.
The court also stated that as a result of hacker attacks that occurred immediately after the bankruptcy was declared, $477 million in cryptocurrencies were withdrawn from the wallets of the exchange’s clients. Formerly Reuters reportedthat Sam Bankman-Fried, the founder of the FTX crypto exchange, secretly transferred $ 10 billion of client funds to the accounts of the trading company Bankman-Fried Alameda Research. At the same time, about $ 2 billion of them disappeared. Later, the chief lawyer of the American division of the FTX crypto exchange, Ryan Miller confirmed information about “unauthorized transactions” in the bankrupt platform, but did not specify the amount of the missing funds. As a result, on November 16, American investors sued Sam Bankman-Fried. In a $11 billion lawsuit, they accused him of creating a pyramid scheme.
This week it became known that the exchange owed $3.1 billion to its largest clients. A Delaware court has decided not to disclose the names of FTX creditors for the time being, but may reconsider this decision in the future.
Read about the situation on the market in the material “It’s somehow non-bitcoin in the cryptocurrency market”.
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