Bloomberg reports that bankrupt cryptocurrency exchange FTX may use customer payout funds to restart its company.
Sullivan & Cromwell attorney Andrew G. Dietderich told US Bankruptcy Judge John T. Dorsey that the exchange’s reopening is still under discussion. The company could also try to raise funding for a restart or scrap the entire concept, the lawyer added.
In February, the law firm Sullivan & Cromwell billed FTX $13.5 million, including fees for analyzing “long-term options.” According to one report, an analysis was made of potential security issues associated with a possible restart of FTX, and another reports discussions with cybersecurity company Sygnia regarding the restart of the exchange.
Lawyers analyzed the possibilities of restoring the exchange, and also studied the circumstances related to taxation, including tax rules adopted in the US jurisdiction. They also spoke with the head of the exchange John Ray (John Ray) on the topic of creating a mock exchange for user experience testing.
In January, John Ray announced a possible restart of FTX in order to recoup losses from creditors and customers. According to the latest data, the exchange’s debt to creditors is about $11.6 billion, of which the exchange managers were able to find only $2.8 billion.
In early April, the company’s debt restructuring team found out that the exchange lacked proper financial and accounting controls. To run the multibillion-dollar empire, former FTX executives relied on a hodgepodge of Google Docs, Slack messaging, shared drive information, and Excel spreadsheets, Ray said.
