To repay its creditors, Samuel Bankman-Fried's (SBF) bankrupt FTX exchange filed a move to sell, hedge, and convert its cryptocurrencies to fiat. The US Trustee objected to FTX's submission, and a hearing for the exchange's request was set for September 13.The outcome of the hearing will be eagerly watched by FTX's creditors for indications on …
To repay its creditors, Samuel Bankman-Fried’s (SBF) bankrupt FTX exchange filed a move to sell, hedge, and convert its cryptocurrencies to fiat. The US Trustee objected to FTX’s submission, and a hearing for the exchange’s request was set for September 13.
The outcome of the hearing will be eagerly watched by FTX’s creditors for indications on how to recover almost $3 billion in Bitcoin, Ethereum, and other cryptocurrencies.
The FTX exchange’s motion to convert crypto assets to fiat currency will be heard.
The bankrupt crypto trading platform filed a motion on August 23 describing its plan to convert digital assets owned by the business into fiat in order to make creditors whole. More information regarding the proposal and how creditors may profit from FTX’s move may be found here.
The US Trustee objected to the scheme, claiming that the crypto trading site breached Local Rule 4001-2. This regulation is a requirement that applies to all cash collateral and financing requests made under sections 363 and 364 of the United States Bankruptcy Code.
Because the agency regulates the conduct of bankruptcy parties on behalf of the US Government, the September 7 court filing is significant. It is possible that FTX’s intention to convert its cryptocurrency to fiat and generate money through staking or trading will be scrapped.
The court has scheduled a hearing on FTX’s August 23 application for September 13. The decision on the motion by the court could make or break SBF’s strategy to pay its creditors in fiat currency.
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