FTX's US Leadership, Bahamas Liquidators Say They've 'Resolved' Most of Their Issues

According to a press release issued Friday, FTX's U.S. leadership and the company's Bahamas wing's court-appointed liquidators have created a cooperation agreement covering how assets may be inventoried and disposed of, among other concerns.

FTX Trading, the company behind the FTX.com exchange, declared bankruptcy in the United States last November, while FTX Digital Markets, based in the Bahamas, went into liquidation the same month. The joint provisional liquidators in the Bahamas and the leadership of FTX Trading in the United States had clashed in recent weeks, alleging interference with their respective proceedings and disputing over jurisdictional problems. When it filed for bankruptcy, FTX, which has dozens of subsidiaries and affiliated businesses, started a complex bankruptcy case with branches in multiple countries. So far, the United States and the Bahamas have taken the lead in actually moving through the bankruptcy procedure.

Attorneys for FTX Trading urged a U.S. bankruptcy court judge that the liquidators should not have access to FTX's Amazon and Google cloud services or other IT tools.

“We simply don't trust the JPLs to keep this information and not provide it to the Bahamian government,” Sullivan & Cromwell attorney James Bromley stated a month ago. “The Bahamas Securities Commission has already worked with the JPLs to gain access to digital assets and create tokens.”

The Bahamas government and liquidators, on their part, have criticized Ray and his team in the United States, claiming that the claim regarding minting tokens is false and even opposing the U.S. bankruptcy proceedings entirely.

The two parties have even disagreed regarding the worth of the Bahamas' assets. The Bahamas Securities Commission reported last month that it had secured around $3.5 billion in FTX customer assets, which FTX Trading claimed was an inaccurate figure. This Monday, the commission retaliated, calling FTX's figure a “material misrepresentation.”

In a statement issued on Friday, FTX CEO John Ray III stated that the joint provisional liquidators had “productive talks” with his staff this week in Miami.

“There are certain topics where we do not yet have a consensus, but we have handled many of the unresolved concerns and have a route forward to tackle the rest,” he said.

One of the liquidators, Brian Simms, said he “looked forward” to working with the US bankruptcy management.

The parties will “work together to share information, secure and return property to their estates, coordinate litigation against third parties, and consider strategic alternatives for maximizing stakeholder recoveries,” according to the announcement.

According to the statement, FTX Trading will be involved in the Bahamas liquidation processes, while FTX Digital Markets will be involved in the US bankruptcy cases.

The liquidators will be in charge of disposing of FTX-related real estate, but the process will be overseen by both the US bankruptcy court and the Bahamas Supreme Court. Both courts will also be involved in certifying “the inventory of digital assets” managed by the Bahamas Securities Commission.

According to the statement, the cooperation agreement must be signed by both courts. A hearing in Delaware's bankruptcy court was scheduled for Friday morning to resolve some of these jurisdictional difficulties, but it was moved out to January 13.

As a reminder, WikiBit is ready to help you search the qualifications and reputation of projects in a bid to protect you from hidden dangers in this risky industry!