Join Our Telegram channel to stay up to date on breaking news coverage
The cryptocurrency exchange FTX sued the Bahamian affiliate FTX Digital Markets liquidators overseeing its window.
FTX alleges that the liquidators allegedly claimed the ownership of the exchange’s assets inappropriately. According to the lawsuit filed by the FTX exchange management, the liquidators claimed FTX’s cryptocurrency, property, and relationships. The FTX management says the FTX Digital Markets was a fraudulent local service company practice. The company owned no property, exchange, or cryptocurrency seized.
Bahamian officials tasked with winding down FTX Digital markets clashed with FTX since the exchange filed for chapter 11 bankruptcy protection last year in November. However, the Bahamians still control hundreds of millions of dollars in assets. Additionally, the filing mentions that if the FTX debtors succeed in the proceedings, there will be no property for FTX Digital Markets.
The liquidation proceedings against the FTX digital markets by the Securities Commission began a day before the U.S. bankruptcy filing for the FTX exchange. Over 100 affiliates have spared over the FTX assets and access to company information. After agreeing to cooperate on asset recovery, the Bahamian liquidators sought to cool down the dispute in January this year.
After denying any wrongdoing, Sam Bankman Fried will face trial in October. But several FTX insiders have accepted and pleaded guilty to the charges floored against them. According to FTX and its new CEO, Fried took over $2.2 billion from the company during his period that the exchange lost $8 billion.
Liquidators Corporate Shell
A holding company established by former FTX CEO Sam Bankman-Fried, West Realm Shires, Inc., is one of the plaintiffs in the adversarial proceeding with FTX.US, Alameda Research, and the exchange. They list FTX Digital Markets and its joint provisional liquidators Brian Simms, Kevin Cambridge, and Peter Greaves as defendants.
The lawsuit asserts that FTX Digital Markets is “the constructive owner of FTX.com’s property” and requests that the ownership dispute be resolved in The Bahamas. The FTX debtors in charge of the bankruptcy proceeding in the U.S. disagree, claiming that the liquidators inherited a “corporate shell” that they are using to perpetuate a jurisdictional bankruptcy dispute. Lawyers assert that the “baseless” ownership claims will affect FTX’s clients and creditors.
The JPLs’ assertion that they are the rightful owners of the assets of FTX.com is mainly supported by illogical assumptions—FTX DM was not the hub of the FTX Group—for constructive, equitable, and other non-documentary reasons. According to the document, nothing could be further from the truth.
FTX DM’s strange past is a prime example of how the corporate form may be abused. It served as a front for a scheme to scam the debtors’ clients, a scheme for which three people have already entered guilty pleas.
Gary Wang and Nishad Singh, co-founders of FTX and former Alameda Research CEO Caroline Ellison, have all admitted guilt on charges that stemmed from their employment at the bankrupt company. Former CEO Sam Bankman-Fried entered a not-guilty plea to several criminal charges.
Related
Microsoft Launches Web3 Wallet Letting Microsoft Edge Browsers Trade Crypto & NFTs
BlockSec Prevents $5 Million Hack
Coinbase Considers Relisting XRP if Ripple Wins SEC Lawsuit
Newest Meme Coin ICO - Wall Street Pepe
- Audited By Coinsult
- Early Access Presale Round
- Private Trading Alpha For $WEPE Army
- Staking Pool - High Dynamic APY
Join Our Telegram channel to stay up to date on breaking news coverage
