As per a report published by Bloomberg, the lawyers of FTX (the now-defunct crypto exchange company) have been delving into the possibilities to reboot the firm. The legal team of the crypto exchange has studied the tax-related problems, user experience analysis, as well as cybersecurity implications in this respect.
FTX Intends to Restart Its Crypto Exchange as Attorneys Spend Millions to Discover Possibilities
According to the report, their cumulative bill was nearly $13.5 million. This indicates a significant endeavor by the lawyers belonging to Sullivan & Cromwell to recover several billion. They also intend to cooperate with law enforcement agencies to potentially resume the declined crypto exchange firm that was formerly run by Sam Bankman-Fried (SBF).
John J. Ray III, the bankruptcy CEO of the embattled crypto exchange, has stated that he is interested in resuming the services of FTX.com (the international exchange of the platform). As per Ray, the purpose of this restart would be to recover the value for the consumers and the creditors of the firm. Nonetheless, the bankruptcy of the platform may make this endeavor considerably complicated.
The collapse of FTX resulted in claims of up to $11.6B by the creditors. In addition to this, the whole crypto market got destabilized with ongoing consequences. Hence, any endeavor to resume the exchange company would be complicated and there will be a requirement for substantial regulatory and legal experience to navigate diverse risks and challenges.
One of the challenges posed to FTX deals with the restoration of trust among the consumers as well as the wider crypto community. For this, there will be a requirement for a combined effort to deal with the issues that paved the way for the collapse of the firm. This will take into account the enhanced transparency as well as improved risk management to carry out its operations.
Many are of the view that this has been the beginning of the crackdowns carried out by the Securities and Exchange Commission of the United States on the crypto industry. As mentioned by a report, it is ambiguous if the exclusive management of the firm will resume the exchange platform.
Nevertheless, a couple of possibilities are present at the moment regarding the latest appointed group for the defunct crypto exchange’s future.
One is that the restart of the operations could be a restricted endeavor for processing the withdrawals for consumers who remained unsuccessful in accessing funds because of the firm’s collapse. Another possibility says that the restart could play the role of a wider endeavor to resume the whole business of the platform.
Bankruptcy CEO Reports Abnormal Management of the Crypto Exchange
The initial interim report that John Ray III delivered to the autonomous directors regarding the company’s control failures indicates that they found a huge deficiency in records as well as evidence dealing with the accessibility as well as location of both the digital and fiat-based assets. Currently, it is ambiguous where the respective assets were kept or how to access them.
Apart from that, the report also brings to light the deficiency of wide oversight, signifying that the decision-making procedures and the leadership of the firm had no implementation of proper accountability and scrutiny.
In general, the respective things are being focused on by the latest appointed management team to be overwhelmed for a likely reboot of the crypto platform’s operations.
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