Attestor Capital Sues Lemma Technologies over FTX Bankruptcy Claims Dispute
Summary:
Attestor Capital, a London-based hedge fund, has filed a lawsuit against Lemma Technologies, a seller of bankruptcy claims associated with the FTX exchange. Attestor alleges Lemma reneged on a deal to sell its FTX claims for $58 million due to rising cryptocurrency values. While Lemma faces a lawsuit in New York, its principal investor Junho Bang is also charged with stealing digital assets in South Korea.
The ongoing unraveling of the FTX exchange has spilled over into the world of bankruptcy claim stakes, as Attestor Capital, one of FTX's largest claim holders, has lodged a legal challenge against a claim vendor. Attestor, a London hedge fund specializing in distressed assets and private equity, has emerged as one of the key purchasers of FTX's bankruptcy-bound assets, sharing this position with Silver Point Capital and Diameter Capital Partners. As per data from the Claims Market, Attestor, as of February, held the most substantial stake in FTX claims, having bought upwards of $400 million worth.
After seeing a 200% profit margin, courtesy of its FTX claims, Attestor has proceeded to slap a lawsuit against Lemma Technologies, the vendor of one of the largest FTX accounts it had acquired, as reported by Bloomberg on March 18. Attestor alleges that Lemma agreed to sell its FTX claims to them for a sum of $58 million in June 2023, but later reneged on the deal following the rise in cryptocurrency values - with Bitcoin experiencing a near-130% surge over the last year.
Based in Panama, Lemma eventually chose to retain the claim for itself, purportedly provoking Attestor's lawsuit, which accuses Lemma of suffering a clear bout of "seller's remorse." As per Bloomberg's coverage, Lemma has yet to publicly defend itself or lodge a counter-suit in New York against Attestor's allegations.
Attestor's attorneys included in their suit that Lemma refuses to "proceed with the transactions or otherwise honor the trade confirmations," unless required to do so by law. Both Attestor and Lemma were approached for a comment on the lawsuit but hadn't returned a response by the time of reporting.
Meanwhile, Lemma is also battling a new lawsuit in New York and one of its primary investors has run afoul of the law in South Korea. Lemma’s chief investor, Junho Bang, stands accused of pilfering digital assets from the now-defunct crypto lending firm Haru Invest, following his arrest and reported indictment by South Korean authorities in January.
As previously documented by Cointelegraph, Haru Invest previously operated a cryptocurrency yield platform, guaranteeing investors a 12% annual yield on cryptocurrency deposits. The platform was abruptly halted in June 2023, citing partner service issues. South Korean prosecutors later apprehended Haru Invest’s CEO and two executives for siphoning off $830 million from thousands of customers.
Published At
3/18/2024 12:04:30 PM
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