The post FTX Pursues $11 Million Recovery from Crypto.com Over Bankruptcy Settlement appeared on BitcoinEthereumNews.com.

Bankrupt crypto exchange FTX is intensifying its asset recovery efforts as it seeks to return funds to creditors. FTX-affiliated trading firm, Alameda Research, recently filed a complaint against Crypto.com to unlock over $11 million held in a Crypto.com account. On November 7, Alameda Research filed a lawsuit in the United States Bankruptcy Court for the District of Delaware, requesting Crypto.com to release approximately $11.4 million held in an account registered under “Ka Yu Tin,” an alias associated with Alameda’s operations before FTX’s bankruptcy. According to court documents, Alameda alleges that Crypto.com has refused multiple requests to return the assets, which the firm claims are critical to its debt-repayment strategy. Former Alameda CEO Caroline Ellison said in her sworn testimony that those funds, in fact, were Alameda’s and meant quite a lot concerning the ongoing recovery process of the bankrupt estate. Ellison’s declaration supports FTX’s stance that Crypto.com’s decision to lock the account unjustly withholds vital assets from FTX’s restructuring plan. The $11 million stuck on Crypto.com represents a fraction of a broader asset freeze on FTX-related accounts since the company filed for Chapter 11 bankruptcy protection last November 2022. Several exchanges froze accounts owned by Alameda amidst the bankruptcy, citing the labyrinthine nature of FTX subsidiaries and trading activities.  Similar to the Crypto.com case, Alameda has also filed legal action against KuCoin, seeking to unlock approximately $50 million that the exchange has retained since FTX’s collapse. Crypto.com, however, has refrained from returning the assets, citing mismatches in account registration details and other regulatory constraints. Despite FTX’s attempts to address these discrepancies, Crypto.com has remained unresponsive, prompting Alameda to escalate the matter in court. FTX’s Strategic Push for Asset Recovery FTX’s focus on recovering blocked assets is an integral component of its bankruptcy restructuring and creditor repayment plan. After two years…

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Filed under: News - @ November 10, 2024 12:21 pm