Sirwin
Sirwin

FTX Lawyers Smokes the Committee for Unsecured Creditors

By Cje95 | Chronic Illness and Crypto | 20 Aug 2023


A couple of days ago FTX lawyers submitted a rebuttal to the bankruptcy court and did not hold back in the slightest. On July 31st the team in charge of recovering assets for FTX victims submitted a reorganization plan as required. When this news broke the Committee for Unsecured Creditors publically stated that the plan ignored any of their suggestions. Further, it was alleged that there was no communication with FTX which is a key thing later.    

 

In FTX's response to the allegations of the Committee for Unsecured Creditors, key discrepancies were identified and refuted with clear and evidence-backed facts. One of the key complaints about the lack of communication was completely blown up by the FTX team as they submitted calls logs, email logs, and more showing that they kept trying to reach out and talk with this Committee only to be ignored or dodged in return. For FTX this was a huge win for one big/key point... that the amount that FTX had been charging (billable hours) was not as crazy or outrageous as people had tried to make it seem with the sheer amount of communication along with having to deal with a situation as dumb as this. 

 

Both sides are armed with an army of lawyers so how the Committee lawyers decided to make this type of move and think that they would win is surprising. It blew up entirely in their face since it only painted the bankruptcy people in better light which was the opposite of what was wanted. I mean how many people looked at this and signed off on it?! It is mindblowing, to say the least! 

 

While other issues were raised it was surprising, to say the least how poorly the objection was done. FTX was able to submit a clear paper trail dispelling the worst of the information vindicating them of most of the complaint. For the parts that were not as straightforward, FTX was able to easily explain what was going on and why. One big example of this is the swapping of crypto for US Treasures. Investing in US Treasuries was not as straightforward as one might seem because they have crypto assets and the recent bank failures have made the Treasuries market much less lucrative and even a little riskier due to the price one has to pay.    

 

Overall the filing and what it revealed was pretty shocking just because of how bad it made the Committee look. It could even be argued that the money administrators charged for handling FTX wasn't as outrageous as people once thought. Having to deal with time-consuming and pointless things like this ends up just causing the bankruptcy to be more expensive and people to end up getting less back. I am sure we will have additional claims being submitted to try and rebuttal this but it is clear that this did not work and as I mentioned earlier only worked in the FTX administrators' favor.              

 

 

 

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Cje95
Cje95

Graduated from Texas A&M in May of 2020 had dabbled in crypto since 2017 but dove in at the end of 2019. December of 2020 packed up and moved to D.C.! Huge sports fan, space nerd, and international newsreader! Follow me on Twitter @Cje95_


Chronic Illness and Crypto
Chronic Illness and Crypto

Cryptocurrency and Blockchain are going to be a huge part of the future and no matter who tries it isn't going to be stopped! Here I try to give my best insight and thoughts into the latest crypto news, features, developments. Further, I look to discover any link to news from the United States ranging from social-political issues to stock market and economic data.

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