FTX applies for an extension to respond as creditors oppose freezing of $470 million in overseas claims
PANews reported on July 22 that according to Cointelegraph, the liquidation team of the bankrupt crypto exchange FTX applied to the Delaware Court for an extension to deal with more than 90 objections raised by creditors to its $470 million cross-border payment freeze plan. This "motion for extension application" will buy more time for FTX asset managers to make statements on the suspension of payments to creditors in so-called restricted jurisdictions. The document was filed on Sunday and a hearing is scheduled for Tuesday to deal with the original motion that triggered the legal dispute.
The initial motion of the FTX liquidation team proposed to list 49 jurisdictions including China as "restricted areas", of which Chinese creditors accounted for 82% (about US$380 million) of the claims. In the motion, the FTX liquidator stated that initiating repayments to these regions may trigger local legal risks, including criminal liability of senior executives. However, the plan was strongly opposed by creditors. Weiwei Ji, a representative of Chinese creditors, said that he was organizing hundreds of investors to collectively defend their rights. Creditor Sunil Kavuri revealed that there are still $1.4 billion in claims pending.
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