FTX Files Billion-dollar Lawsuit Against Bybit
13 Nov, 2023 ● Crypto News
The FTX bankruptcy estate, led by CEO John J. Ray III, has sued Bybit, its investment arm, Mirana, and several executives.
The goal is to recover funds and digital assets that Bybit withdrew from FTX just before its demise, which are now worth close to $1 billion.
According to the lawsuit, Bybit used its "VIP" access and connections with FTX staff to withdraw significant cash and digital assets from Mirana, Time Research (another entity linked to Bybit), and executives just before FTX's collapse.
During FTX's withdrawal issues in November 2022, employees tracked VIP customers' withdrawal requests in a spreadsheet labeled "VIP Request — Prioritize (Settlement)."
The lawsuit alleges FTX's settlement team went out of their way to prioritize Mirana's significant withdrawals, resulting in over $327 million in transfers to Mirana.
Based on reports, the total value of assets withdrawn by Bybit and its executives from FTX has now reached nearly $1 billion.
According to the lawsuit, Bybit has imposed limitations on the FTX estate, preventing the withdrawal of assets worth more than $125 million from the Bybit exchange.
Bybit is allegedly using these assets as leverage to seek recovery for a $20 million balance that it was unable to withdraw from FTX prior to its collapse.
FTX notified Bybit that the action violated the automatic stay in Chapter 11 bankruptcy, according to the lawsuit.
Despite this, the "community vote" was carried out, with votes appearing to be linked to Bybit executives.
Notably, the wallet "dtoh.eth," identified as Mirana Ventures, a Mirana subsidiary led by David Toh, received the fifth-largest vote.
The lawsuit seeks "compensatory and punitive damages" from Bybit in relation to the token scheme and the assets held on its platform.
Sources:
https://cointelegraph.com/news/ftx-files-billion-dollar-lawsuit-against-bybit-over-asset-withdrawals
https://restructuring.ra.kroll.com/FTX/Home-DocketInfo
https://delegatevote.mantle.xyz/0xf87095925339f7fFdde266258f62947567de6aEb
