VOT Research Desk
On November 11, the cryptocurrency exchange and 130 of its affiliates applied for Chapter 11 bankruptcy protection in the US. Investors are curious as to when they will be able to get their money from the now-defunct cryptocurrency exchange FTX, but insolvency attorneys caution that it may take decades.
The process of realising the cryptocurrency assets and determining how to divide the monies will be a enormous exercise in the liquidation process, according to insolvency lawyer Stephen Earel, partner at Co Cordis in Australia.
The procedure might take years, if not decades. According to him, this is because cross-border bankruptcy concerns are complicated and there are multiple competing jurisdictions.
Earel stated that regrettably, FTX users must wait in line with all other creditors, investors, and venture capital backers. forewarning people who have engaged in crypto to crypto exchanges that they might not get a dividend for years.
Heaver stated that the legal system, including courts and bankruptcy administrators, will supervise creditors’ rights only “when and if” FTX enters Chapter 11 bankruptcy processes.
People who have suffered significant losses as a result of the FTX collapse are advised by Heaver’s to seek legal counsel and band together with other harmed parties. Investors all over the world have experienced major effects as a result of the recent FTX collapse.
The recently-disclosed bitcoin exchange may have “more than 1 million debtors,” according to a recent report. According to a Nov. 20 Reuters article, the insolvent cryptocurrency exchange owes its top 50 creditors a combined total of close to $3.1 billion.
