Why FTX Might Try to Claw Back Funds From Retail Customers- Ep. 547
Sep 22, 2023
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Thomas Braziel, founder of 117 Partners, shares his expertise on the FTX bankruptcy saga. He discusses the intricate legal landscape, including the potential lawsuits against Sam Bankman-Fried's parents and the moral implications of their actions. Braziel delves into how civil cases could escalate to criminal charges, and the challenges facing creditors in the bankruptcy process. The possibility of FTX clawing back funds from retail customers is also explored, revealing the tough road ahead for investors seeking recovery.
FTX chief John Ray III is focused on clawing back funds from former affiliates to pay back creditors in ongoing lawsuits.
The SEC's crypto assets and cyber unit is intensifying its focus on businesses operating similarly to Coinbase and Binance, with a commitment to bringing charges against violators of federal securities laws.
Deep dives
SEC intensifies focus on crypto exchanges like Coinbase and Binance
The head of SEC's crypto assets and cyber unit, David Hirsch, stated that the agency is intensifying its focus on businesses operating similarly to Coinbase and Binance, including intermediaries and decentralized finance products. Hirsch affirmed the SEC's commitment to bringing charges against violators of federal securities laws.
Binance US denies using Sefu and faces scrutiny from SEC
Binance US has denied using Sefu, a crypto custodian owned by Binance, as alleged by the SEC. The regulatory body is investigating the relationship between Binance US and Sefu, suspecting that Binance US facilitated the movement of US customer funds abroad. The judge has encouraged both parties to cooperate and find a middle ground in the ongoing legal dispute.
SEC's crackdown on smaller crypto startups
The SEC's crypto assets and cyber unit, led by David Hirsch, announced its intention to focus on smaller crypto startups and intermediaries, expanding its investigations beyond prominent exchanges like Coinbase and Binance. The agency aims to impose strict know-your-customer and anti-money laundering requirements on these entities.
Gemini Trust opposes Genesis Global creditors' recovery proposal
Gemini Trust has strongly opposed the recovery proposal for Genesis Global creditors put forth by DCG, calling it a total mirage. The proposal suggested recovery rates for unsecured creditors between 70% and 90%, with Gemini users potentially seeing a recovery rate of 95% to 110%. Gemini argues that the proposed rates do not reflect the real value terms.
As lawsuits continue to pile up in the FTX saga, FTX chief John Ray III is focused on clawing back funds from former affiliates to pay back creditors. But how might that play out in court? Founder of 117 Partners Thomas Braziel, who specializes in the trading of bankruptcy claims, explains the different paths Ray may choose to go down and the potential outcomes of these cases.