A US court has ordered fallen crypto exchange FTX to make a multi-billion dollar payment as relief to compensate customers for losses suffered.
The US District Court for the Southern District of New York has ordered FTX to pay $12.7 billion in monetary relief to FTX customers and victims of its fraud, according to a statement by the Commodity Futures Trading Commission (CFTC). The payment includes $8.7 billion in restitution and $4 billion in disgorgement.
In a separate settlement agreement approved by the Bankruptcy Court for the District of Delaware, CFTC also agreed not to seek a civil monetary penalty against FTX and to subordinate monetary claims to victims.
«FTX used age-old tactics to create an illusion that it was a safe and secure place to access crypto markets. But the basic regulatory tools, like governance, customer protections, and surveillance that exist to identify misconduct and ultimately prevent collapse, were simply not there,» said CFTC chairman Rostin Behnam.
Bankruptcy Proposal
This marks yet another chapter in the FTX fiasco following its collapse. The fallen crypto exchange is currently soliciting votes on a proposal to offer 100 percent of customers’ claims against it, based on the value of their accounts at the time of filing for bankruptcy. Some oppose the deal, claiming the repayment is based on lower crypto prices from November 2022. The votes are due on August 16.
In March, FTX founder Sam Bankman-Fried was sentenced to 25 years in prison for stealing $8 billion from customers. He has appealed the conviction and previously claimed that he «never thought what [he] was doing was illegal».
