Delaware Judge Pegs Low Values for Crypto Tokens in FTX Bankruptcy Case

July 12, 2024

Delaware Judge Pegs Low Values for Crypto Tokens in FTX Bankruptcy Case

The debtor’s prebankruptcy machinations to inflate the value of tokens resulted in low claim valuations in bankruptcy.

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Opinion Link

View Opinion

https://abi-opinions.s3.amazonaws.com/FTX+coin+appraisal.pdf

Case Details

Case Citation

In re FTX Trading Ltd., 22-11068 (Bankr. D. Del. June 26, 2024)

Case Name

In re FTX Trading Ltd.

Case Type

Business

Court

3rd Circuit

Delaware

Bankruptcy Tags

Bankruptcy Litigation

Valuation

Business Reorganization

Comments

Submitted by Kyle Arendsen on July 12, 2024

Unbelievable how FTX was able to manipulate the value of these tokens prepetition, and unfortunate for the creditors who were impacted. I'm sure the expert testimony was compelling from both sides, but it seems like the court could not get behind supporting the artificially high value of the tokens as of the petition date.

Submitted by Thomas Salerno on July 14, 2024

This is a fascinating decision! Jamie Dimon was right a couple of years back when he called investment in crypto like an investment in "pet rocks."