FTX Strikes $228 Million Deal with Bybit Amid Bankruptcy
This article comes to you with the generous support of Crypto-Games. Sign up now and get the rewards that await you at Crypto-Games with a 200% deposit bonus of up to 20,000 USDT!
Swift Asset Recovery Boosts FTX’s Creditor Payout Plans
FTX has agreed to a $228 million settlement with Bybit, bringing closure to a high-stakes lawsuit that aimed to retrieve $1 billion in assets. This settlement, which follows a legal battle launched in November 2023, grants FTX the right to recover $175 million in digital holdings on Bybit’s platform and allows for the sale of $53 million in BIT tokens to Mirana Corp., Bybit’s investment division.
The lawsuit alleged that Bybit used “VIP” access and insider ties with FTX executives to pull $327 million in digital funds before FTX’s downfall—a move FTX argued was an unfair advantage under bankruptcy laws. For FTX, this resolution marks a crucial advancement in its bankruptcy strategy, securing immediate access to assets intended to benefit creditors.
The legal action, tied to FTX’s Chapter 11 bankruptcy case filed in 2022, targeted Bybit Fintech Ltd., Mirana Corp., and associated individuals. FTX claimed these entities withdrew significant funds shortly before the company’s collapse, arguing those assets should have remained with the estate.
Looking to leverage the volatility as the process goes on? Head over to Bybit, the go-to exchange for top coins. Secure your spot and ride the wave of crypto opportunities!
Under the settlement, parties who made pre-bankruptcy withdrawals will retain creditor claims worth 75% of their account balances as of FTX’s filing date. This compromise is expected to save FTX’s estate millions by reducing the number of potential allowed claims, creating a clearer path to asset recovery. Awaiting a November 20 court approval, the settlement is set to simplify FTX’s efforts to repay creditors, sidestepping the prolonged expenses of ongoing legal proceedings.
FTX’s legal team acknowledged the trade-offs, citing the costs, potential asset depreciation, and enforcement difficulties of a lengthy lawsuit. The legal team highlighted that while they believed the case had merit, the settlement offered immediate certainty, enabling quicker access to crucial assets for creditors.
This approach aligns with FTX’s approved reorganization plan, which aims to return at least $12.6 billion to affected customers. The settlement with Bybit brings additional liquidity to this pool, directly supporting FTX’s mission to maximize creditor recoveries.
Need a smart way to trade new tokens? Let Telegram bots handle it—get started with Maestro now and stay ahead of the market!
Since taking the reins, FTX’s CEO John J. Ray III has emphasized negotiated agreements to streamline the bankruptcy process, reduce litigation costs, and speed up asset distribution.
The Bybit settlement exemplifies this strategy, avoiding the legal hurdles and expenses of an extended court battle. If the court signs off on this agreement, it will signify major progress in FTX’s plan to settle outstanding claims and bring its bankruptcy process closer to resolution.
This article has been refined and enhanced by ChatGPT.
