According to a press release issued on Friday, the leadership of FTX in the United States and the court-appointed liquidators of the company’s Bahamas wing have entered into a cooperation agreement that addresses a variety of issues related to the inventory and disposal of assets.
The company that operates the FTX.com exchange, FTX Trading, filed for bankruptcy in the United States in November of last year, and the Bahamas-based FTX Digital Markets entered liquidation proceedings in the same month.
Over the course of the previous few weeks, the joint provisional liquidators in the Bahamas and the leadership of FTX Trading in the United States had argued over jurisdictional issues and accused one another of interfering with their respective proceedings.
When FTX filed for bankruptcy, it started a complicated case with dozens of subsidiaries and related entities and branches in a number of countries. So far, the United States and the Bahamas have taken the initiative to actually go through the bankruptcy process.
FTX Trading’s legal team advised a bankruptcy judge in the United States that the liquidators should not have access to FTX’s Amazon and Google cloud services or other IT tools.
A month ago, Sullivan and Cromwell attorney James Bromley stated, “We simply don’t trust that the JPLs will be able to hold this information and not provide it to the Bahamian government.” In order to gain access to digital assets and mint tokens, the Securities Commission of the Bahamas has already worked with the JPLs.
The government of the Bahamas and the liquidators, on the other hand, have expressed dissatisfaction with the manner in which Ray and his team in the United States have handled the bankruptcy as well.
They claim that the assertion that tokens were minted is false and even attempt to counteract the bankruptcy proceedings in the United States entirely.
Even the value of the Bahamas’ assets has been a point of contention between the two sides. FTX Trading claimed that the Securities Commission of the Bahamas’ announcement last month that it had secured approximately $3.5 billion worth of FTX customer assets was inaccurate.
This week, the commission responded by labeling the figure provided by FTX a “material misstatement.”
John Ray III, CEO of FTX, said in the statement on Friday that the joint provisional liquidators had “constructive meetings” with his team this week in Miami.
He stated, “There are some issues where we do not yet have a meeting of the minds.” However, he also stated that “we resolved many of the outstanding matters and have a path forward to resolve the rest.”
Additionally, one of the liquidators, Brian Simms, stated that he “looked forward” to working with the managers of the U.S. bankruptcy.
“Work together to share information, secure and return property to their estates, coordinate litigation against third parties, and explore strategic alternatives for maximizing stakeholder recoveries,” the release states.
According to the statement, FTX Trading and FTX Digital Markets will participate in the bankruptcy proceedings in the United States.
The FTX-related real estate will be sold by the liquidators, but the process will be overseen by both the bankruptcy court in the United States and the Supreme Court of the Bahamas.
The Securities Commission of the Bahamas’ “inventory of digital assets” will also be confirmed by both courts.
The statement stated that the cooperation agreement requires the approval of both courts. On Friday morning, a bankruptcy court in Delaware was supposed to hold a hearing on some of these jurisdictional issues, but the hearing was moved to January 13.
4 thoughts on “Bahamas liquidators claim to have “resolved” most of their problems, according to FTX’s US leadership.”
I’m tired of this FTX fiasco
Sam bankman will not go to jail so he is more rich now
Binance is next
the liquidators should not have access to FTX’s Amazon and Google cloud services or other IT tools. Just wow