FTX Allowed to Remove Client Names from Filings: Details
- The court has granted permission to FTX to redact all the client names from all bankruptcy filings to protect them from scams.
- The list of nine million clients of bankrupt crypto exchange is “extraordinarily valuable,” claims Kvein Cofsky.
- Cofsky, a member of the FTX restructuring team, said that releasing the client list may lower the firm’s sale value.
- He said that it “would be detrimental” to the exchange’s attempts to restructure if others gained information regarding FTX‘s clients.
The bankruptcy of crypto exchange FTX under the leadership of Sam Bankman-Fried affected countless crypto investors who might have their names revealed in court. According to Kevin Cofsky, a partner at Parella Weinberg who serves on the maintenance committee of the exchange, the list of the nearly nine million FTX clients is “extraordinarily valuable” and, if made public, may lower the bankrupt firm’s sale price.
Based on the reports, Cofsky, a member of the FTX restructuring team, stated in a court proceeding that was released earlier this week that it “would be detrimental” to the exchange’s attempts to restructure if others gained information regarding FTX’s consumers.
“We believe that the existing customer base is extraordinarily valuable, and our understanding is based on our research and having looked at the costs incurred by other crypto companies specifically to solicit customers,” Cofsky said.
As per a report, the name of the clients will not be revealed to protect them from scams and identity theft. The bankrupt exchange has been given the authority to remove names from all the bankruptcy filings. Bankruptcy Judge John Dorsey in Wilmington, Delaware, said that “it is the customers who are the most important issue in this case.”
Notably, the consumer’s list was recently secured by a seal, but major media outlets objected to the ruling on the grounds that the public and press have “a presumptive right of access to bankruptcy filings.” Several media organizations that have opposed it are Bloomberg, the Financial Times, The New York Times, and Dow Jones & Company, the parent company of The Wall Street Journal.
Cofsky asserts that the list of customers is “extremely valuable and valued” by the individuals who care about the firm and that FTX has started a “significant” method for assessing interest from consumers, investors, or even a relaunch of the exchange.
“I think that releasing that information would impair the debtor’s ability to maximize the value that it currently possesses,” he noted.
As reported earlier by BitcoinWisdom, the new CEO and Chief Restructuring Officer of the crypto exchange hinted at the possibility of restarting the crypto firm in the near future. While some key FTX executives have been charged with criminal activity, Ray claimed that several FTX clients have lauded the company’s technology and suggested that a reboot may be worthwhile.
A crypto journalist with over 3 years of experience in DeFi, NFT, metaverse, etc. Parth has worked with major media outlets in the crypto and finance world and has gained experience and expertise in crypto culture after surviving bear and bull markets over the years.
