FTX’s Bankruptcy Managers Take Legal Action Against Bybit and Others to Recover $953 Million in Assets
In a bold move, FTX’s bankruptcy managers have initiated legal action against Bybit crypto exchange and two other entities in an attempt to recover $953 million in assets that were withdrawn before the collapse of the exchange. This latest development comes after the bankruptcy managers’ recent efforts to reclaim the funds from various parties.
Lawsuit Against Bybit
On November 10, bankruptcy advisers filed a lawsuit against Bybit and its investment arm, Mirana Corp. The lawsuit alleges that the bankrupt firm coerced the defendants into processing $953 million in withdrawals before its collapse. It further claims that Mirana Corp. had special privileges that allowed them to withdraw assets from FTX and that they pressured FTX employees to facilitate these withdrawals. Interestingly, the timing of Mirana’s asset withdrawals coincided with a surge in withdrawals leading up to FTX’s collapse.
According to the filing, Bybit also used its control over FTX Group assets as leverage to push Mirana to the front of the line. Bybit seized FTX Group assets held on its exchange and refused to release them unless Mirana was able to withdraw the entire balance of its FTX.com account. The primary objective of the lawsuit is to recover the approximately $953 million in assets that Mirana withdrew from FTX, including over $327 million allegedly withdrawn between November 7 and 8 last year. The lawsuit also implicates another crypto trading firm, Time Research Ltd, and a Mirana executive, suggesting that some Singaporean residents may have also benefited from these withdrawals.
FTX’s Asset Recovery Efforts
The lawsuit aligns with FTX’s ongoing efforts to recover funds that were withdrawn in the months leading up to its collapse. The firm believes that recovering these funds will enable a fair distribution of assets among all victims of its failure. So far, FTX has managed to recover $7 billion worth of assets, including cryptocurrency, through various recovery endeavors.
In addition to the lawsuit against Bybit and Mirana Corp., FTX has also filed lawsuits against its former executives, such as Sam Bankman-Fried, Caroline Ellison, Gary Wang, and Nishad Singh. The failed firm has also taken legal action against several other firms, including K5 Global, that received funds from FTX.
FTX’s estate is also taking steps to maximize its crypto holdings. As of November 8, the firm has transferred over $300 million worth of crypto assets, including Solana and Ethereum, to exchanges.
Conclusion
In conclusion, FTX’s bankruptcy managers are leaving no stone unturned in their efforts to recover assets and funds that were withdrawn before the collapse of the exchange. The recent legal action against Bybit and other entities is a bold move to reclaim $ 953 million in assets. This lawsuit, along with FTX’s ongoing recovery endeavors, demonstrates the firm’s commitment to ensuring a fair distribution of assets among all victims of its failure. As FTX continues to take legal action and maximize its crypto holdings, the outcome of these efforts remains to be seen.
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