The identities of customers affected by last November’s FTX collapse can stay hidden per a bankruptcy judge in Delaware. Judge John Dorsey – the man overseeing the case involving the now notorious exchange’s asset liquidation process – says all names of former traders associated with the firm fall under the category of “trade secrets.”
FTX Customers Can Stay Out of the Public Eye
He explained in a recent interview:
It’s the customers that are the most important issue here. I want to make sure that they are protected, and they don’t fall victim to any types of scams that might be happening out there.
He said it’s important to keep their information out of the limelight so that their data isn’t stolen by scammers, and they’re not taken advantage of by illicit actors. Brian Glueckstein – a former legal representative of FTX – seconded this by explaining:
The debtors are in a position to realize value from these customer lists.
However, Dorsey was quick to say all creditors and equity holders involved with FTX can be named, as doing so will not present any harm to the firms in question. Kate Townsend, a representative of various media outlets, says the collapse of FTX will arguably go down as one of the worst events to ever transpire within the crypto arena. She mentioned:
At this point, we don’t even know where the shock waves, both individually and institutionally, have hit the hardest, and what institutions may have the largest, or no, exposure as a result.
The exchange – which first opened in 2019 – rose to prominence three years later to become one of the top five digital currency trading platforms in the world. Its founder and chief executive Sam Bankman-Fried was lauded as a genius by many, and his net worth was in the billions towards the end of 2022.
A Long and Weak History?
Sadly, this reputation was short-lived as in mid-November, SBF complained of a liquidity crunch on social media. He said he needed fast cash to keep his business in operation, and he eventually turned to his biggest rival Binance about a possible buyout. While things appeared to be moving in that direction for some time, Binance eventually backed away from the deal, claiming the problems FTX was facing were simply too big for it to handle.
From there, the company filed bankruptcy and SBF resigned from his post. Things would have been bad enough if they had stopped there, but the trash meter kept rising. It was later discovered that SBF had utilized customer funds to invest in luxury Bahamian real estate and to pay off loans taken out by his other company Alameda Research. He was eventually arrested and extradited back to the United States. He has entered a not guilty plea and is awaiting trial at his parents’ California home.
