- There are ongoing speculations based on settled legal fees that FTX may be restarted.
- Amidst the restarting clamor, many complications must be navigated across the board.
The collapse of FTX Derivatives Exchange, the once mega trading outfit co-founded by Sam Bankman-Fried caused a lot of hurt for customers and investors across the board. While there was no viable hope that the exchange would come back to life following the hurt and losses incurred, the opposite appears to be happening today.
According to a Bloomberg report, the lawyers advising the crypto trading platform have been charging the firm for services related to the rebooting of the exchange. The sum charged FTX is as high as $13.5 million in legal fees for February and the fees include payment for collaborations with key partners that can help activate the rebooting plans.
It remains unclear whether or not the leadership of the exchange will be pivoting toward the restart of the trading platform However, John Ray III, the veteran that is in charge of the firm at the moment once revealed plans to relaunch FTX.com, the international offshoot of the platform While his aim is hinged on returning maximal value to shareholders and creditors, the complication surrounding the move remains quite enormous at this time.
The exchange’s lawyers and personnel have uncovered the total sum of $7.3 billion from the more than $11.3 billion it is currently owing investors. While balancing this sum will be one of the first major challenges the firm will face in the proposed effort to go back to business, navigating legal challenges with respect to regulatory demands is another thing.
Though the trading platform is not under scrutiny from the United States Securities and Exchange Commission (SEC) by covering its bankruptcy, a return to the business may stock the regulator who has placed exchanges on its radar in recent times.
FTX restart plans may unnerve customers
When FTX filed for bankruptcy, it said it had between 100,000 to 1 million creditors, most of whom remain unpaid to date. Although customers of the Japanese outfit of the trading platform have regained access to their locked funds as the subsidiary was one of the few solvent entities, customers of the parent company remain locked out of their funds.
Until the repayment of these users is completed or processed to a very large extent, an attempt to restart the trading platform is certainly going to unnerve the customers in a great way.
The efforts to restart FTX will likely feature two distinct measures. The first may be to reboot the platform in a bid to give users an avenue to claim and withdraw their funds. This will be easy, however, efforts to start up the exchange for full-blown business activities may introduce complications that will be hard to navigate.
“When we talk about restarting — rebooting — it’s not totally clear what they have in mind,” aid Daniel Tramel Stabile, a partner at law firm Winston & Strawn LLP
There could be a rebooting in the sense of reopening the exchange with a limited purpose for getting assets off the exchange.