FTX, the crypto exchange that made headlines with its dramatic downfall back in 2022, is now making waves again, but this time for making some serious cash moves! They recently struck a deal to settle a lawsuit against Bybit and its execs, along with its investment arm, Mirana. The result? A cool $228 million expected to help pay back the folks they owe.
This whole saga kicked off with a lawsuit in 2023. FTX wasn't taking its bankruptcy lying down and was on a mission to get back assets for its former customers and creditors. The settlement, if the court gives it a nod, will see FTX grabbing $175 million in digital goodies from Bybit and selling $52.7 million in BIT tokens to Mirana Corp., which just so happens to be Bybit's investment buddy.
FTX believes this deal is a win-win for everyone involved. They reckon it's a better bet than duking it out in court, which could eat up resources that should be heading to creditors. They even asked the court to skip the usual 14-day wait for asset distribution so they can get things moving pronto.
The final decision on this settlement will be made during a court hearing set for November 20, 2024. Mark your calendars, folks!
Let's rewind a bit: FTX filed for bankruptcy at the end of 2022 after everything went belly up. Part of its recovery plan involved a bunch of lawsuits. This particular one was filed a year after FTX went under, seeking a whopping $1 billion from Bybit and Mirana. They accused Bybit of using its “VIP” status to sneak out cash and assets worth hundreds of millions, even after FTX hit the pause button on withdrawals for everyone else. Bybit allegedly kept some of FTX's assets on their platform, playing hardball.
But there's more to the story. FTX's bankruptcy plan, approved on October 7, promises to pay back 98% of users with a jaw-dropping 118% of their claims in cash. They've projected a total recovery of somewhere between $14.7 billion and $16.5 billion, thanks to assets snatched back from various sources, including the U.S. Department of Justice and foreign regulators.
FTX's collapse set off a legal tsunami, with FTX and its sister company, Alameda, smack in the middle of the largest regulatory showdown in the crypto world. The grand total of settlement fees? A mind-blowing $12.7 billion, setting a record for penalties in the crypto realm. Can't wait to see what happens next in this crypto drama!
