The bankruptcy estate of the now-defunct cryptocurrency exchange FTX has decided to withdraw its motion aimed at limiting creditor distributions to certain “potentially restricted foreign jurisdictions.” This decision follows substantial pushback from creditors and a wave of objections filed in bankruptcy court.
The trust’s motion, filed in early July, aimed to implement procedures that could have significantly affected the rights of creditors in these regions. However, numerous objections—over 70—were submitted shortly after the motion was made public, prompting the estate to reconsider its approach.
In related developments, the FTX estate’s planned repayment strategy has raised concerns about the actual value of distributions. Creditor representative Sunil Kavuri cautioned that creditors might receive far less than anticipated, particularly since repayments are being issued in fiat currency rather than cryptocurrencies.
Meanwhile, amidst the backdrop of FTX’s legal struggles, co-founder Sam Bankman-Fried is seeking to overturn his fraud conviction and 25-year prison sentence.
The appeal is being presented by Alexandra Shapiro, a criminal appeals lawyer known for her successes in similar cases. She is set to argue against the conduct of Judge Kaplan, who has been accused of bias against Bankman-Fried throughout the trial.
The defense claims that Kaplan pressured jurors for a swift verdict by offering amenities and suggesting they could extend their deliberation hours. Moreover, they assert that the judge “ridiculed” Bankman-Fried’s testimony and undermined his defense.
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