• Thu. May 23rd, 2024

FTX Customers Ask Court To Keep Their Names Secret

Summer White

BySummer White

Dec 31, 2022

Court documents have revealed that a group of customers of the now-defunct FTX crypto exchange, who are located outside of the United States, have requested that their names be withheld.

These customers have requested this of the court, which is overseeing the bankruptcy case of Sam Bankman-Fried’s crypto empire.

The request

A Wednesday filing revealed the request of the 15 creditors, who claim that they want to be anonymous because crypto holders are vulnerable to theft and fraud.

According to these creditors, the FTX crypto exchange owes them a total of $1.9 billion collectively. They also asserted in the filing that tracing crypto is difficult and there are not enough safeguards that can protect the assets.

It should be noted that these customers of FTX are not the only ones who do not wish to reveal their identities.

Back in November, the company requested Judge John Dorsey, who is presiding over the bankruptcy case, to withhold the name of some of its biggest creditors and he fulfilled it.

According to FTX, disclosing the creditors’ names would compromise their security, as private information like physical addresses or email, would have to be shared.

Estimates indicate that the top 50 creditors of FTX are owed a total sum of $3.1 billion after the downfall of the crypto exchange.

Different request

However, it should be noted that a suit had been filed by the Financial Times, Bloomberg, Dow Jones, and the New York Times in which they have asked the judge to reveal the names.

The judge stated that the media organizations would be permitted to present their arguments on the matter in January.

The FTX empire blew up back in November and allegations state that it is because of gross mismanagement.

James Bromley, who is part of the new management at FTX, said that this collapse was one of the most difficult and abrupt ones to have happened in corporate America’s history.

The new CEO of the company is an expert insolvency professional, John J. Ray III, who also highlighted the bad management of FTX.

He said that consumer-level apps like QuickBooks and Slack had been used by the staff for managing the finances of the multibillion-dollar behemoth.

Other details

Ray is known for handling the bankruptcies of companies like Enron. He said that the downfall of the Bahamas-based company was due to a small number of grossly unsophisticated and inexperienced individuals.

It has been alleged that Sam Bankman-Fried, the co-founder of FTX and its sister firm, Alameda Research, had comingled customers’ deposits without their knowledge.

Bankman-Fried has now been extradited to the US from the Bahamas, where he had been arrested, to face eight criminal charges filed against him, including those of money laundering and wire fraud.

A lawsuit has been filed against him by the US CFTC and charges have also been filed by the SEC. He has been placed under house arrest and is staying with his parents, after being released on a $250 million bond.

Summer White

Summer White

Summer White, an esteemed writer for Big Trends Signals, combines her online trading expertise and articulate writing to deliver exhaustive guides and fair reviews, assisting traders in digital markets.

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