FTX Wallets Move $8.3M in Crypto Amid Pending Debt Repayment Plans
Summary:
Cryptocurrency worth $8.3 million was moved from wallets linked to the now insolvent FTX exchange and its sister firm, Alameda Research. This transfer comes ahead of a deadline for FTX's debtors to submit an amended plan detailing repayment to creditors. This event follows several months after a legal case was launched against bankruptcy firm Sullivan & Cromwell by FTX's creditors, who accused the firm of profiting from FTX's fraudulent activities. Despite ongoing legal battles, FTX creditors have already sold over $490 million worth of their claims. The lengthy court proceedings mirror the infamous Mt. Gox case related to a 2014 hack, where users are still awaiting compensation.
In a recent transaction linked to insolvent exchange FTX and its affiliate firm Alameda Research, wallets connected to both entities moved cryptocurrency equating to a staggering $8.3 million. The FTX-linked wallet transferred Tether Gold (XAUT) valued at over $2 million to automated trading entity, Wintermute. By contrast, an Alameda-associated wallet dispatched 2,027 Ether (ETH) equal to over $6.3 million to two unidentified addresses, reported by PeckShield in a May 6 article. The motive behind these transactions remains unclear, however, they took place one day before the deadline for FTX debtors to submit an updated version of the Plan and Disclosure Statement, due May 7. This new plan may further clarify how FTX creditors will be reimbursed for their lost funds. The deadline for any objections is June 5. FTX's collapse, along with its more than 130 subsidiaries, is regarded as a high-profile catastrophic event in the crypto industry, leading to a loss of at least $8.9 billion. This eventually resulted in a severe cryptocurrency market downturn when Bitcoin's price dropped to $16,000. As for when FTX creditors will be repaid, FTX's revised plan could provide insights, but several creditors are anticipating unfavorable news. Sunil, a chief FTX creditor and member of the largest creditor group FTX Customer Ad-hoc Committee, has warned users to reject the upcoming plan, claiming it would favor the debtors. This warning follows a lawsuit launched almost three months ago against bankruptcy firm Sullivan & Cromwell (S&C) by leading FTX creditors, alleging that S&C profited from FTX's fraudulent activities. So far, through 507 transactions, FTX creditors have sold over $490 million worth of claims, according to Claims Market data. Legal proceedings could potentially extend for several years, reminiscent of the Mt. Gox cryptocurrency exchange prolonged case following a notorious hack in 2014, where users are still awaiting compensation.
Published At
5/6/2024 2:01:56 PM
Disclaimer: Algoine does not endorse any content or product on this page. Readers should conduct their own research before taking any actions related to the asset, company, or any information in this article and assume full responsibility for their decisions. This article should not be considered as investment advice. Our news is prepared with AI support.
Do you suspect this content may be misleading, incomplete, or inappropriate in any way, requiring modification or removal?
We appreciate your report.