OKX, the second-largest crypto exchange, has announced that it will turn over approximately $157 million in frozen assets related to FTX and Alameda Research to debtors in response to a motion filed today in the FTX bankruptcy proceedings.
The move comes after OKX initiated investigations following FTX’s collapse in November 2022 to determine whether there had been any FTX-related transactions on its platform. During these investigations, the exchange discovered assets and accounts associated with FTX and Alameda Research and immediately froze them, ensuring the safeguarding of the assets.
In a press release, OKX expressed their approval of the proposal and highlighted their collaboration with FTX debtors and law enforcement authorities, aiming to restore these assets to FTX users via the bankruptcy process.
This news is a significant development for FTX users who have been left in limbo since the exchange’s collapse. The return of assets will provide some relief to those who lost funds in the process and help move the bankruptcy proceedings forward.
The return on frozen assets is a positive step for the crypto industry as a whole. It underscores the importance of exchanges taking proactive measures to safeguard users’ assets and demonstrates the necessity of regulatory oversight to prevent fraudulent activities.
The announcement also highlights the critical role that Web3 technology companies such as OKX can play in ensuring the integrity of the crypto market. As the industry evolves, companies like OKX will be crucial in establishing a secure and transparent ecosystem for all stakeholders involved.
However, the decision by OKX to turn over frozen assets is a win for FTX users and the wider crypto community. It serves as a reminder that protecting users’ assets must always be a top priority for all players in the industry.
Controversy Over FTX’ Ex-CEO Legal Fee Reimbursement Request
In another FTX-related update, its ex-CEO Sam Bankman-Fried is facing fierce opposition to his attempt to reimburse his legal expenses. Lawyers representing the exchange and its creditors’ committee have filed objections to his motion to cover his court costs by directors’ and officers’ (D&O) insurance policies.
If the judge were to approve SBF’s motion, he would be placed at the top of the payout queue, which has been met with outrage from FTX’s legal team.
In their filing, they argued that it would be “unfair, inequitable, and contrary to the interests of justice” to prioritize Bankman-Fried’s legal fees at the expense of other potential claimants.
They also suggested that if the court approves his request, the insurance payout should apply to other directors and officers who have a claim to the funds.
The Official Committee of Unsecured Creditors also objected, pointing out that D&O insurance policies only apply “where they make honest decisions in the ordinary course of the business,” which they claim is not the case regarding SBF’s request.
They labeled Bankman-Fried the “alleged perpetrator of one of the largest criminal frauds in the last decade” and urged the court to decline his request.
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