FTX sues Bybit in an attempt to recover nearly $1 billion:
- FTX, a major player in the world of cryptocurrencies, is engaging in a legal battle against Bybit in a case involving nearly $1 billion.
- Bybit allegedly took advantage of its ‘VIP privileges’ to withdraw hundreds of millions of dollars just before FTX’s collapse in November 2022.
- FTX hopes to recover a portion of these funds as part of a potential comeback in the coming months.
FTX vs Bybit: A Clash of Titans
FTX, amidst its financial downfall, has recently filed a lawsuit against Bybit, another cryptocurrency exchange. The complaint, filed in a Delaware court, aims to recover approximately $953 million in crypto and cash.
According to FTX’s lawyers, these funds were withdrawn by Bybit just before FTX declared bankruptcy in November 2022. It is worth noting that the amount was calculated using November 1st prices, but may be adjusted in the coming weeks, FTX states.
The Accusations Against Bybit
Bybit’s investment subsidiary, Mirana, is accused of taking advantage of ‘VIP privileges’ on FTX, allowing for the withdrawal of most of its assets before FTX filed for bankruptcy and collapsed.
The complaint also alleges that Mirana exerted pressure on FTX employees to speed up these withdrawals, while ordinary clients faced delays.
It turns out that over $327 million, nearly a third of the total amount, was withdrawn between November 7th and 8th, a period during which FTX had suspended withdrawals.
The Implications of this Legal Action
This case raises important questions about the fairness and legality of withdrawals made by privileged actors in the volatile world of cryptocurrencies.
As FTX strives to make a comeback, with notable interest from former NYSE President Tom Farley, the outcome of this legal battle could have a significant impact on its recovery efforts. Indeed, if FTX manages to recover a portion of these funds, it could be used to compensate a substantial portion of defrauded investors.
In addition, FTX has begun selling its Solana tokens to raise funds, as the cryptocurrency recently surpassed the $50 mark.