Disagreements between the bankrupt FTX Trading (in U.S. bankruptcy) and the liquidators of the Bahamas organization, FTX Digital Markets, have been largely resolved, according to an announcement on Friday. Previously there has been considerable distrust between the parties involved in the bankruptcy of the cryptocurrency exchange, with the U.S. side making allegations against the Bahamas. For example, it alleged that the Securities Commission of the Bahamas (the Commission) was involved in minting new FTT tokens and transferring digital assets after it triggered the liquidation procedures.
Now the two sides have agreed to cooperate in the chapter 11 cases of FTX Trading in Delaware and the provisional liquidation of FTX Digital Markets in the Bahamas.
This will involve:
- sharing information
- securing and returning property
- coordinating lawsuits against third parties
- strategies to maximize the recovery of funds
The parties have also agreed on the sale of real estate in the Bahamas, which will be led by the Bahamas liquidators and overseen by the bankruptcy courts in both Delaware and the Bahamas. Additionally, there’s an agreement on the procedure to confirm the digital assets held in a Fireblocks account under the control of the Securities Commission of the Bahamas.
However, the CEO of FTX Trading, John Ray, said, “There are some issues where we do not yet have a meeting of the minds, but we resolved many of the outstanding matters and have a path forward to resolve the rest.”
The agreement still needs to be approved by the U.S. Bankruptcy Court in Delaware and the Supreme Court of the Bahamas.
Tussle over Robinhood shares
In other news relating to the bankruptcy, there’s a four-way fight over shares owned in Robinhood worth around $464 million between FTX Trading, BlockFi, Sam Bankman-Fried and the Department of Justice.
The stock is owned by Emergent Fidelity Technology which Sam Bankman-Fried and Gary Wang control. The two formally borrowed funds from Alameda to buy the stock, which was pledged as security to crypto lender BlockFi. FTX Trading is trying to block the sale of the stock, but Emergent is not one of the companies in the bankruptcy group.
Hence both BlockFi and Bankman-Fried’s lawyers have objected. Meanwhile, on January 4, BlockFi said it learned that the Department of Justice had executed a seizure warrant and taken control of the shares.