FTX settles lawsuit with Bybit and Mirana

The move will enable the the failed cryptocurrency exchange to recover approximately USD 228 million, funds that will be used to repay creditors in the upcoming months. In a court filing submitted recently, FTX officials detailed their efforts to engage in lengthy, good faith negotiations and ultimately reach a global settlement.

The terms of the settlement will permit FTX’s liquidation estate to retrieve USD 175 million in cryptocurrencies stored in Bybit accounts. Additionally, FTX plans to sell over 105 million BIT tokens held by Mirana, which are valued at roughly USD 52.7 million according to theblock.co.

Furthermore, defendants who transferred their funds out of FTX prior to its bankruptcy will retain the right to recover 75% of the total balance in their accounts as of the date of the bankruptcy petition.

The lawsuit was initiated by FTX in November of last year, accusing Bybit of using its VIP access to withdraw substantial amounts in cash and digital assets shortly before FTX’s collapse in 2022. FTX also alleged that Bybit hindered the estate’s attempts to withdraw assets from its trading platform, effectively holding those assets ‘hostage.’

Recent developments from FTX

Recently, FTX, under the leadership of bankruptcy expert John J. Ray III, reported that more than 94% of its creditors have approved its reorganisation plan. The approval was granted by US Bankruptcy Judge John Dorsey during a hearing in Wilmington, Delaware. Dorsey described the case as a benchmark for handling a complex Chapter 11 bankruptcy.

The approved plan includes several settlements with various stakeholders, including FTX creditors, customers, US government agencies, and liquidators managing the company’s non-US operations. Under these settlements, FTX will prioritise repaying its customers from the recovered assets, before addressing claims from regulators.