3AC Boosts FTX Claim to $1.53B
Three Arrows Capital Increases FTX Claim to $1.53 Billion
In a significant development in the ongoing FTX bankruptcy proceedings, a US bankruptcy court has authorized the liquidators of defunct crypto hedge fund Three Arrows Capital (3AC) to significantly increase their claim against the collapsed exchange. The claim has jumped from $120 million to a substantial $1.53 billion.
Chief Judge John Dorsey of the US Bankruptcy Court for the District of Delaware overruled FTX’s objections. FTX debtors argued the amended claim was untimely and intended to obstruct bankruptcy proceedings. However, Judge Dorsey's March 13 ruling determined that 3AC liquidators provided adequate notification and that delays were largely due to FTX's failure to promptly provide necessary documentation.
Details of the Amended Claim
3AC liquidators initially filed a $120 million claim in June 2023. This was later amended in November 2024 to $1.53 billion, citing claims for breach of contract, unjust enrichment, and breach of fiduciary duty. The liquidators allege FTX held $1.53 billion in 3AC assets, which were liquidated to cover $1.33 billion in liabilities in 2022. They contend these transactions were avoidable, harmed 3AC creditors, and that FTX's delays in providing information hindered the discovery of this liquidation.
FTX's Response and Other Legal Actions
FTX debtors contested the amended claim, arguing the initial claim lacked sufficient detail and was filed too late. However, the court sided with 3AC.
This development comes as FTX continues its own recovery efforts. In November 2023, FTX filed lawsuits against several entities, including:
- SkyBridge Capital and Anthony Scaramucci to recover funds spent by former FTX CEO Sam Bankman-Fried.
- Binance and Changpeng Zhao to recover $1.76 billion in cryptocurrency.
- Waves founder Aleksandr Ivanov for $80 million in crypto sent to a Waves-based protocol by Alameda Research.
3AC’s liquidators have also pursued claims against other bankrupt firms, including a $1.3 billion claim against Terraform Labs. The collapse of 3AC, once managing over $3 billion in assets, highlights the risks within the cryptocurrency market.
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