FTX Bankruptcy Proceedings Delayed
The attorneys representing the bankrupt crypto exchange FTX have argued that the Delaware bankruptcy court needs to postpone the proceedings for “a month or two months” to understand how FTX became insolvent. Lawrence Gebhardt of Gebhardt and Smith, who is representing FTX, requested the delay due to the high cost and extensive travel required for discovering the circumstances of the case, as key parties are located in different parts of the world. For instance, former FTX attorney Dan Friedberg is in Washington, former counsel Can Sun is in the Bahamas, and former CEO Sam Bankman-Fried, recently convicted of fraud, is in prison.
Gebhardt emphasized the need to depose all these individuals and uncover what happened between November 2021 and October 2022 that led to FTX’s insolvency.
Denial of Motion
However, Jonathan Carter, a partner at Sullivan and Cromwell managing the bankruptcy, stated that the defense had ample time to participate in the discovery process and was informed about all available documents for processing on September 21. The judge ultimately denied the motion, emphasizing that if the discovery is complex, it needs to commence immediately instead of being delayed.
Hot Take: Former FTX CEO Convicted of Fraud
On November 2, former FTX CEO Sam Bankman-Fried was convicted of defrauding customers, lenders, and investors by channeling funds from FTX users and investors to its affiliated trading firm Alameda Research.
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