FTX Burdened by 3AC

     Judge John T. Dorsey of the US Bankruptcy Court in Delaware has ruled in favour of Three Arrows Capital (3AC)'s liquidators, permitting them to increase their claim against FTX to $1.53 billion, thereby overturning the objections raised by FTX's creditors. FTX is in the process of reimbursing its creditors, but its financial burden is set to increase substantially regarding its dealings with the 3AC.

Allegations by 3AC Liquidators Create a Quagmire

     The liquidators of 3AC alleged that FTX had improperly utilised 3AC's assets, valued at approximately $1.53 billion, to settle outstanding debts. Furthermore, they claimed that FTX had undervalued these assets and deliberately withheld crucial information. The liquidators successfully convinced the judge that FTX had breached its fiduciary duties, causing damage to 3AC's creditors.

Scammers in a Precarious Position

     FTX denied these allegations, stating that a representative from 3AC had authorised the liquidation. However, FTX's lawyers were unable to provide concrete evidence to support the claim. And I suppose this ruling (against FTX) may strengthen the liquidators' claim against Terraform Labs.

Originally published on Wubits