March 28, 2024

FTX sues the liquidators of the Bahamian division of the exchange

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FTX sues the liquidators of the Bahamian division of the exchange

The interim administration of collapsing FTX has sued FTX Digital Markets and its Bahamian liquidators, saying they have an improper claim on the cryptocurrency exchange's assets.

FTX Interim Administration Asks US Judgebankruptcy attorney John Dorsey to intervene and confirm that the assets of exchange founder Sam Bankman-Fried and other employees housed in the Bahamas unit were "fraudulent transfers" and therefore rightfully owned FTX.

Lawyers representing FTX Group describethe Bahamian division as an economic and legal “dummy” created for “cover.” According to a statement from FTX's interim administration, liquidators of the exchange in the Bahamas "continue to make unreasonable demands that will harm FTX.com customers and other creditors."

Liquidators of the Bahamian division of FTX Digital Markets, which is not bankrupt, laid claim to the assets of FTX.com. This is stated in the company's court documents. 

The collapse of FTX in November 2022 shocked the entirecryptocurrency industry. The founder of the exchange, Sam Bankman-Fried, is accused of eight criminal offenses, but does not admit guilt. Now the ex-head is free on bail in the amount of $250 million.  

FTX temporary managers were able to detectonly $2.7 billion of the $11.6 billion that should have been in customer accounts. Part of the shortfall can be attributed to Alameda Research, which borrowed $9.3 billion from customer accounts before the stock market crash.  

It was recently revealed that the founders and key executives of the bankrupt FTX received $3.2 billion in payments and loans, mostly from a subsidiary of Alameda Research.