Judge John Dorsey Hides Names of FTX Creditors Owed $3.1 Billion Following Crypto Exchange Collapse

Group of ftx customers located outside of the united states recently asked the court overseeing the cryptocurrency exchange’s bankruptcy case to have their names withheld. the customers are collectively owed $1.9 billion by ftx and the top 50 creditors are owed an estimated $3.1 billion following the collapse of the crypto exchange. judge john dorsey granted the company’s request and withheld the names of the biggest ftx creditors. the new york times, dow jones, bloomberg, and the financial times this month filed a suit asking for the names to be revealed.

Collapse of the crypto exchange happened in april 2021 when ftx allowed customers to buy, sell, and bet on the future price of digital assets. counsel to ftx’s new management james bromley described it as “one of the most abrupt and difficult collapses in the history of corporate america.” john j. ray iii, a veteran insolvency professional and the company’s new ceo, claimed that ftx was so badly managed that its staff used consumer-level apps slack and quickbooks to handle the multibillion-dollar behemoth’s finances.

Founder and former ceo sam bankman-fried commingled customers’ investments with those of its sister trading firm alameda research without clients knowing. bankman-fried is now facing eight criminal charges—including wire fraud and money laundering—along with charges from the u.s. securities and exchange commission (sec) and a lawsuit from the commodity futures trading commission (cftc). he is currently under house arrest at his parents’ house on a $250 million bond and was extradited from the bahamas last week, where he spent days in prison before his transfer to the united states. cryptocurrency holders are particularly susceptible to fraud and theft, and publishing creditors’ names could reveal private information—such as email or physical addresses—and compromise their security. this is why the ftx customers asked the court to withhold their names.


By Evey Lovelace

You May Also Like