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FTX China's Creditor Claims Controversy: Legal Basis in Doubt, Hope Remains for Compensation Outlook
On July 6, the Chinese encryption KOL expressed opinions on the matter "FTX creditors claim they may confiscate compensation funds from Chinese users":
"FTX's debts are denominated and settled in US dollars, and it has now entered the compensation distribution phase, which has nothing to do with cryptocurrency regulation. There is no legal risk for Chinese citizens receiving compensation in US dollars. The motion by the FTX Recovery Trust has lacked legitimate legal basis from the very beginning."
In addition, in the Celsius bankruptcy case, this is also an American encryption company that compensated creditors through bank wire transfers, and Chinese creditors also successfully received compensation. The KOL believes that FTX can compensate Chinese creditors in the same way.
According to previous news, Sunil, a representative of FTX creditors, stated on social media that in the claims from countries where FTX is restricted, 82% of the claim funds belong to Chinese users. However, cryptocurrency trading is currently not allowed in China, and there are no authorized distributors.
According to the document provided by Sunil, FTX will seek legal advice and will proceed to allocate if it can to potential restricted foreign jurisdictions. If it is determined that the residents belong to restricted foreign jurisdictions and claims generate disputes, the allocation may be forfeited.