Three Arrows Capital (3AC) has achieved a significant legal victory against FTX. A U.S. bankruptcy court has approved increasing 3AC's claim against FTX from $120 million to $1.53 billion.
Court Ruling Against FTX
The ruling was issued by the U.S. Bankruptcy Court for the District of Delaware. It favors 3AC's liquidators, Russell Crumpler and Christopher Farmer, who initially filed their claim in June 2023. This marks a crucial step towards recovering funds lost during FTX's collapse.
Case Details and Evidence
The increase is based on new evidence showing significant financial dealings between 3AC and FTX. The expanded claim includes allegations of breach of contract, breach of fiduciary duty, and unjust enrichment. Investigations revealed that FTX liquidated 3AC's assets worth $1.53 billion to cover $1.3 billion in liabilities shortly before 3AC's liquidation.
Implications for the Crypto Market
As the case progresses, it's uncertain how this will impact the bankruptcy proceedings and creditor repayments. Former FTX CEO Sam Bankman-Fried seeks a presidential pardon, though his chances remain debated. The unfolding legal battles may significantly influence the future of crypto bankruptcies.
This decision is a vital step for 3AC in recovering funds lost in the FTX collapse and could have major implications for the cryptocurrency industry.
