FTX Takes Legal Action Against ByBit
FTX, a well-known cryptocurrency exchange, has initiated legal proceedings against ByBit Fintech Ltd and its affiliated companies to recover cash and digital assets worth approximately $953 million. The bankruptcy advisers of FTX are seeking to reclaim these funds, alleging that ByBit withdrew all funds just before FTX filed for Chapter 11 bankruptcy a year ago.
Lawsuit Unveils VIP Scandal
In a lawsuit filed in a Delaware court, FTX claims that Bybit’s investment arm, Mirana Corporation, received exclusive “VIP” benefits not available to most FTX customers. Mirana allegedly used these privileges to swiftly withdraw a substantial portion of its assets from FTX before its collapse in November 2022. The complaint also highlights Mirana’s exertion of pressure on FTX employees to fulfill its withdrawal requests while regular customers faced prolonged delays.
Chapter 11 in Action to Recover $1 Billion
Chapter 11 bankruptcy typically allows failed companies to recover funds in the months leading up to the bankruptcy filing, aiming to prevent certain creditors from gaining an unfair advantage solely because they managed to withdraw their funds before the company’s failure. The lawsuit aims to recover assets valued at approximately $953 million, including over $327 million that Mirana allegedly withdrew from FTX between November 7 and November 8, 2022.
This legal action represents the latest effort by FTX’s new management to reclaim funds disbursed before the Chapter 11 filing in November of the previous year.
FTT Price Skyrockets to $4.55
Meanwhile, the native token of FTX, FTT, has seen a staggering 97% rally in just 24 hours, marking the most substantial gain among the top 50 cryptocurrencies since the beginning of 2023. This surge, along with momentum from the previous day, has led to total gains of an astounding 240% in just two days. Intriguingly, FTT breached a critical resistance level at $4.55 during intra-day trading, hinting at potential newfound support for the altcoin.
Hot Take: The Impact of FTX’s Legal Action and Token Surge
The legal action taken by FTX against ByBit sheds light on alleged VIP privileges and asset withdrawals just before FTX filed for Chapter 11 bankruptcy. This move underscores FTX’s determination to recover approximately $953 million in cash and digital assets. Meanwhile, the significant surge in the price of FTT showcases strong market interest and potential support for this native token of FTX.
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