US officials overseeing FTX's bankruptcy proceedings have agreed to coordinate with the liquidators liquidating the cryptocurrency exchange operations in the Bahamas, resolving a dispute that threatened the recovery of what could be billions of dollars in funds.
In a joint statement Friday, the parties said they will work to share information, protect property and coordinate litigation against third parties.
FTX's US bankruptcy team has been at loggerheads with Bahamian officials since November, when competing bankruptcies were filed in the two countries.
The Bahamas Securities and Exchange Commission began liquidation proceedings on November 10 against FTX Digital Markets, the Bahamas-based unit of the company.
The next day, a US Chapter 11 proceeding was filed in Delaware, involving more than 100 FTX entities, including FTX Trading and cryptocurrency hedge fund Alameda Research.
Bahamian regulators have seized FTX assets, which officials say were meant to safeguard assets that will ultimately be returned to FTX Digital Markets creditors.
John Ray, who took over FTX after founder Sam Bankman-Fried resigned in November, accused the Bahamas-based liquidators of colluding with the disgraced founder to undermine the US bankruptcy case and transfer assets to the Bahamas.
Ray's lawyers had rejected the liquidators' demand for access to internal systems and Slack and email accounts, saying they "did not trust" the Bahamas with information that could be used to divert assets from the US bankruptcy team. .
Bahamian securities regulators accused Mr. Ray of displaying โan arrogant attitude towards the truthโ in his statements about the Bahamian asset seizures.
The US team also disputed the size of the Bahamian assets that were seized, saying they were worth $296 million in November, not $3.5 billion as liquidators estimated. The statement on Friday said that the US team was now comfortable with the assets being properly protected.
Ray said there were still some unresolved issues in the settlement with the Bahamian liquidators. Friday's statement said details of the deal would be filed "shortly" with the US Bankruptcy Court in Delaware.
Ray, a liquidator, and attorneys for the liquidators did not respond to a request for comment.
Bankman-Fried was arrested on fraud charges Y pleaded not guilty on January 3. Ray said the exchange lost $8 billion of client money, adding that the bankruptcy team is focused on recovering assets to pay off creditors.
Updated: January 07, 2023, 11:33
