The insolvency cost of FTX is reaching close to $ 1 billion, making it one of the most expensive chapter 11 cases in American history.
The court records show that the legal and financial firms working on the case have been paid around $ 948 million, with a fee of over $ 952 million approved so far. Despite the huge cost, most customers are expected to recover 118% of their claims, according to a rare result in bankruptcy proceedings, Bloomberg,
Efforts to recover assets worth billions of dollars in high fees stem extends on a complex web of accounts. Lawyers and financial advisors have played an important role in this process, in which hedge funds have purchased FTX claims at standing exemption among beneficiaries.
FTX began the initial distribution to creditors last week, although legal teams continued to track additional assets.
Sullivan and Cromwells
According to Bloomberg, FTX’s lead law firm, Sulivan and Cromwells have been paid more than $ 248 million, while financial advisors Alverase and Marsal have received approximately $ 306 million. Customer claims and other creditor cases overseeing the firm charged a $ 110 million.
Sulivan and Cromwell played an important role Guiding American Treasury and major financial institutions during the 2008 financial crisis. The firm assisted JP Morgan Chase’s bear Sterns and assistance with AIG’s official bailout.
Additionally, the firm provided legal and financial lawyers after Enron insolvency, one of the most important corporate fraud cases in history.
The FTX case costs more than the Crypto bankruptcys including Celsius, Genesis, Blockfi, and Vyzer Digital, which occurred together as about $ 502 million in expenses.
The bankruptcy is still facing the ongoing litigation, which includes a case against Benance, demanding $ 1.8 billion.
While the cost of FTX is important, according to Bloomberg, Lehman Brothers remain below the insolvency of $ 6 billion – the most expensive in American history.
