Creditors Seek Priority $1.6B FTX Payout
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An editor at Coincrop
22 Dec 2022 | 2 min read
versheds Sutherland noted that their clients have approximately $1.6 billion worth of assets in custody on FTX and should be given priority when it comes to receiving payments back.
Eversheds Sutherland, an esteemed law firm on behalf of its FTX clients, has petitioned the Delaware bankruptcy court to accelerate repayment for their customers since the funds are custody assets and not affiliated with FTX's bankruptcy estate.
According to bankruptcy regulations, assets that generate a return are part of the company's holdings, while those which don't yield returns remain in the customer's possession.
In a similar situation, the court granted repayment for custody clients in a bankruptcy case about Celsius Network. As there is precedent for such requests, it is likely that this petition will be accepted as well. However, those with earn-accounts have to wait until proceedings are finalized before they can get their money back.
Broderick explained that FTX's agreement of services would allow their custody clients to access the funds which were previously inaccessible.
With anticipation, Evershed Sutherland announced that they plan to commence the legal process in January 2023 and are confident of a seamless transition.
ChrisAn editor at Coincrop
Jonathan is a Coincrop staff writer based in the UK, covering the best rates for cryptocurrency earning and borrowing products. When not at work, he's likely sailing.
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