FTX's Request Denied: Bankrupt Crypto Company Will Ask for $1.53 Billion! - Coin Newsletter

U.S. bankruptcy court has allowed collapsed crypto hedge fund Three Arrows Capital to raise its claim against (3AC), FTX, to $1.53 billion.

In a ruling on Thursday, the U.S. Bankruptcy Court in the District of Delaware approved Three Arrows Capital's decision to extend its initial claim against FTX to $1.53 billion** from an initial $120 million. The court rejected the objections made by FTX's bankruptcy executives that 3AC's application for a claim increase was too late. According to the court, 3AC's liquidators filed their demands in a timely manner, stating that the delay was largely due to the fact that FTX executives were slow to share the records.

**"The evidence presented shows that the liquidators were diligent in obtaining the necessary information and that FTX executives were repeatedly delayed in sharing the information despite having full information," the court ruling said. With this decision, 3AC will be able to seek a total of $1.53 billion from FTX on different grounds including breach of contract, unjust enrichment, breach of fiduciary duty, and other damages.

FTX fails appeal

In a court filing, FTX's bankruptcy team argued that Three Arrows Capital's expanded claim was excessive and would harm the company's restructuring plan by making it harder for creditors to repay. However, the court rejected the objection, stating that the FTX team failed to back up these allegations with sufficiently strong evidence.**

Three Arrows Capital, which was once one of the important names in the cryptocurrency world, went bankrupt in 2022 due to liquidity problems after the Terra-Luna crisis** under the leadership of its founders Su Zhu and Kyle Davies.