“U.S. Prosecutors Launch Website to Help Victims of FTX Collapse”

Federal prosecutors have set up a website to provide information to victims of ftx, a cryptocurrency exchange that collapsed in december 2020. more than 100,000 creditors may have been affected by the collapse, but this number is likely much higher when including users of its crypto exchanges. john ray, ceo of ftx, reported that there were 2.7 million users in the u.s. silo and 7.6 million users in the ftx.com silo when the website was shut down.

Collapse of ftx occurred on december 9, 2020 when the department of justice charged ftx founder sam bankman-fried with eight criminal charges, including wire fraud and conspiracy to commit money laundering. bankman-fried was extradited to the u.s. on december 21 and appeared in manhattan to plead not guilty on all the criminal charges. caroline ellison, former ceo of alameda research, and ftx co-founder gary wang were also charged in connection with the case against bankman-fried, and both have since pleaded guilty and have been cooperating with investigators.

Department of justice requested a deadline extension to january 23, but then once again asked to push the date back to april 15 on december 21. the ad hoc committee proposed a solution similar to the one used in the celsius bankruptcy case, which considered all account holder claims to be against all the debtor’s entities. u.s. district judge lewis kaplan approved the prosecutors’ request to use the website to communicate with people who lost money in ftx’s collapse. the website is intended to provide victims with the necessary information and allow them enough time to give testimony prior to plea or sentencing proceedings.


By Evey Lovelace

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