FTX Reaches Agreement with Bahamian Liquidators
FTX has entered into a settlement with liquidators
for its Bahamas-based unit. This agreement involves the consolidation of assets and
adopting a unified approach to valuing customers’ claims.
According to a statement shared with PR Newswire,
this settlement allows customers of FTX to select their repayment route from
either the U.S. bankruptcy or Bahamian liquidation proceedings.
Peter Greaves, the Joint Official Liquidator,
mentioned: “This continues to be an exceptionally complex insolvency with
a myriad of jurisdictional, technical and practical challenges to work
through.
“For the millions of customers of the FTX
Group, based across 230 jurisdictions, this is a landmark breakthrough allowing
for collaboration in the monetization of assets and the adjudication of
customer claims, with an approach that provides a roadmap to accelerate the
return of funds to customers.”
Under this agreement, FTX’s US-based team will spearhead asset recovery efforts, potentially including the sale of FTX.com exchange or intellectual property. Meanwhile, Bahamian liquidators will focus on selling Bahamas-based real estate assets and pursuing specific legal claims.
Last year, FTX Digital Markets applied for bankruptcy protection in the United States. This move happened after a
tumultuous period for FTX, marked by court filings, regulatory scrutiny, and
the appointment of provisional liquidators.
Prior to this, the Securities Commission of the Bahamas (SCB) suspended
FTX’s registration and froze its assets. On top of that, the Australian securities regulator suspended the
company’s license. Similar moves were made by Japan’s Kanto Local Finance
Bureau and the Cyprus Securities and Exchange Commission.
Early this year, the SCB confronted FTX’s CEO, John
Ray, over assertions about handling $3.5 billion in customer funds. The dispute
revolves around the regulator’s acquisition of digital assets from FTX’s local
entity following the cryptocurrency exchange’s collapse.
Ray challenged the regulator’s reported amount of
held assets, triggering a heated exchange of accusations and legal maneuvers.
FTX Faces Regulatory Challenges in the US and the Bahamas
Ray contested that the Bahamas regulator’s
calculations regarding the digital assets linked to FTX’s customers. The SCB
refuted Ray’s claims, stating that incomplete information led to the challenge
and emphasizing a lack of diligence in his public statements.
Allegations extended to the regulator’s minting of
$300 million in FTT tokens and accusations of theft regarding FTX-held tokens
under the SCB’s custody. The downfall of FTX commenced with its bankruptcy
filing and subsequent fallout involving over 130 affiliates.
Matters worsened when a cyberattack resulted in the
theft of millions in cryptocurrencies post-bankruptcy filing. In response, the
Bahamas regulator leveraged court orders to secure FTX tokens held by its local
entity, also caught in the US bankruptcy proceedings.
FTX has entered into a settlement with liquidators
for its Bahamas-based unit. This agreement involves the consolidation of assets and
adopting a unified approach to valuing customers’ claims.
According to a statement shared with PR Newswire,
this settlement allows customers of FTX to select their repayment route from
either the U.S. bankruptcy or Bahamian liquidation proceedings.
Peter Greaves, the Joint Official Liquidator,
mentioned: “This continues to be an exceptionally complex insolvency with
a myriad of jurisdictional, technical and practical challenges to work
through.
“For the millions of customers of the FTX
Group, based across 230 jurisdictions, this is a landmark breakthrough allowing
for collaboration in the monetization of assets and the adjudication of
customer claims, with an approach that provides a roadmap to accelerate the
return of funds to customers.”
Under this agreement, FTX’s US-based team will spearhead asset recovery efforts, potentially including the sale of FTX.com exchange or intellectual property. Meanwhile, Bahamian liquidators will focus on selling Bahamas-based real estate assets and pursuing specific legal claims.
Last year, FTX Digital Markets applied for bankruptcy protection in the United States. This move happened after a
tumultuous period for FTX, marked by court filings, regulatory scrutiny, and
the appointment of provisional liquidators.
Prior to this, the Securities Commission of the Bahamas (SCB) suspended
FTX’s registration and froze its assets. On top of that, the Australian securities regulator suspended the
company’s license. Similar moves were made by Japan’s Kanto Local Finance
Bureau and the Cyprus Securities and Exchange Commission.
Early this year, the SCB confronted FTX’s CEO, John
Ray, over assertions about handling $3.5 billion in customer funds. The dispute
revolves around the regulator’s acquisition of digital assets from FTX’s local
entity following the cryptocurrency exchange’s collapse.
Ray challenged the regulator’s reported amount of
held assets, triggering a heated exchange of accusations and legal maneuvers.
FTX Faces Regulatory Challenges in the US and the Bahamas
Ray contested that the Bahamas regulator’s
calculations regarding the digital assets linked to FTX’s customers. The SCB
refuted Ray’s claims, stating that incomplete information led to the challenge
and emphasizing a lack of diligence in his public statements.
Allegations extended to the regulator’s minting of
$300 million in FTT tokens and accusations of theft regarding FTX-held tokens
under the SCB’s custody. The downfall of FTX commenced with its bankruptcy
filing and subsequent fallout involving over 130 affiliates.
Matters worsened when a cyberattack resulted in the
theft of millions in cryptocurrencies post-bankruptcy filing. In response, the
Bahamas regulator leveraged court orders to secure FTX tokens held by its local
entity, also caught in the US bankruptcy proceedings.
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