FTX Ruling Could Let Exchanges Seize Assets Worldwide

Update (July 18, 13:30 UTC): This article has been updated to correct the number of objections to the proposal.

FTX creditors’ community is waiting to decide next week, which could let FTX bankruptcy freeze payments to creditors in “limited countries”, including China.

Tuesday is expected that the US bankruptcy court in the Delaware rules on a proposal that could allow FTX Estate to detention of creditors in 49 countries It is marked as “limited jurisdiction”.

If the court approves this proposal, creditors warn against the “devastating consequences” that could exceed the FTX case.

“This proposal is not just about FTX believing. It sets a dangerous precedent that could destroy confidence in the global crypto ecosystem,” Weiwei said, a creditor known as Will on X.

A country of “limited” countries that are not determined by a court

According to it, the potential court approval of the proposal of FTX assets concerning limited countries could become a standard procedure for similar crypto bankruptcy.

“In future bankruptcies, any coastal submission at sea in the US could copy FTX – unilaterally marking countries like China as” limited jurisdiction “to entertain user assets and legally refuse repayment,” the creditor said on Thursday X.

“Lists of limited” are not determined by judges. Just hire a lawyer to write a note – and that’s it, “he said.

Almost 70 objections were filed

From FTX property submitted The proposal 2 July, the proposal raised almost 70 objections on Friday at 11:00 UTC, according to court records of the reviewed companies Caintelegraph on Kroll.

Most objections come from Chinese creditors FTX, which includes more than half of the total submission, Including objections from Ji.

This is in accordance with China, which represents 82% of the total value of potentially affected demands between jurisdictions marked as “limited”.

Objections from Saudi Arabia and more

In addition to Chinese creditors, the list of objections includes at least one submission from Saudi Arabia by Faisal Saada Almutairi.

“By sorting applicants in some countries who are not eligible for distribution, the plan discriminates unfairly. My country does not prohibit ownership or trading in cryptocurrency and regulatory concerns are speculative and not a valid legal basis for refusing recovery,” Almutair reads.

The list also contains more submissions from non -specific countries, including those submitted Oxana Kozlov, Amanuel Giorgis and others.

Impact of movement on the demands of the creditor FTX

Movement reports have triggered volatility at the claims of FTX creditors, specifically related to the jurisdictions of persons.

“We observed a sharp decline-in the range of 20% to 30%-the prices of demands from the so-called limited jurisdictions,” said Federico Natali, a partner on the Paxtibi platform, Caintelegraph said.

Related: Payments of crypto abroad can be legal despite domestic prohibitions in several countries

Paxtibi estimates that customers have sold more than $ 5.8 billion in FTX demands on credit, he said.

“The price offered is, in my opinion, not very friendly,” her said In another post for X on Friday with reference to the Buyer of the FTX claim, such as ftxCredititor.com. “As far as I am concerned, I still fight to get what we deserve – I cannot be forced to sell our demands,” he added.

According to FTX Sunil creditor, Kavuri still exists 1.4 billion USD requirements for FTX, which are waiting for a solution, with $ 380 million and $ 660 million in questionable demands.

Yuriy Brisov, the founder of the crypto regulatory platform Cryptomap, said Cointlegraph that the decision to sell a claim depends on the tolerance of the risk of every person, access to information and understanding the legal process.

“The larger point is this: when the claim becomes a currency, legal accuracy becomes a strategy. And FTX is only one case in the new era of global digital insolvency,” he said.