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Eversheds Sutherland Files Bankruptcy Court Request to Protect Foreign FTX Users’ Assets

Eversheds Sutherland, a law firm, has taken legal action to safeguard the interests of foreign clients of the bankrupt FTX exchange. The firm has filed a request in a bankruptcy court to freeze assets that were previously frozen in the accounts of these clients.

The objective is to separate the funds due to these clients from the general bankruptcy estate and protect them from being unreasonably used to cover significant transaction costs and legal expenses.

According to preliminary data, clients outside the US hold assets worth approximately $2 billion on the FTX exchange.

The FTX bankruptcy process has been ongoing for four months, but the issue of who owns assets on the exchange and to what extent has not been resolved yet. This is a crucial legal issue that needs to be addressed.

Eversheds Sutherland has expressed concerns that the funds of their clients may be used to cover the costs of clerical work and legal expenses.

Various legal and financial advisors to the FTX bankruptcy liquidation panel have already issued invoices worth approximately $20 million for work completed in 2022, according to documents available to the law firm.

The interim administration of FTX had previously sued FTX Digital Markets and its Bahamian liquidators, alleging that they wrongfully claimed the assets of the cryptocurrency exchange.

The legal battle continues, and Eversheds Sutherland is committed to protecting the interests of its clients throughout the process.