FTX Asks Court to Remove Dubai Unit from US Bankruptcy Proceedings

<p>FTX wants its subsidiary based in Dubai to be excluded
from its ongoing bankruptcy proceedings in the US. According to a court
document filed today (Thursday), the bankrupt cryptocurrency exchange argued
that this step would allow for a timely distribution of money owed to creditors.</p><p>"Additionally, FTX
Dubai is balance sheet-solvent," the
<a href="file:/C%3A/Users/admin/Downloads/98a5c262-9ff0-42d7-bc21-c05ffe2d805d.pdf" target="_blank" rel="follow">filing</a> stated. "Therefore, the debtors believe that a solvent
voluntary liquidation procedure in accordance with the laws of the United Arab
Emirates would allow a timely distribution of the positive cash balance after
payment of all outstanding liabilities and liquidation of all assets." </p><p>FTX Eyes Bankruptcy Exit</p><p>Besides that, the
debtors of the exchange told the court that excluding <a href="https://www.financemagnates.com/cryptocurrency/news/ftx-exchange-fze-obtains-approval-from-virtual-assets-regulatory-authority/" target="_blank" rel="follow">FTX
Dubai</a> from the
bankruptcy proceedings in the US would enable the company to meet its immediate
obligations, such as paying wages and salaries. The matter was filed in the US
bankruptcy court for the District of Delaware and is scheduled to be heard on
August 23.</p><p>After <a href="https://www.financemagnates.com/cryptocurrency/troubled-ftx-files-for-bankruptcy-as-ceo-bankman-fried-resigns/" target="_blank" rel="follow">FXT
filed for bankruptcy</a> in
November last year, the company began <a href="https://www.financemagnates.com/terms/b/bankruptcy/">bankruptcy</a> cases for more than 100
of its affiliated entities, including FTX Dubai. The subsidiary, which is owned
by FTX Europe, was created in February 2022. However, according to Thursday's
filing, FTX Dubai did not offer cryptocurrency services before the global
exchange sought bankruptcy protection.</p><p>Similarly, in January,
FTX sought similar court orders to exclude its business units in Turkey from
the ongoing bankruptcy proceedings in the US. In a court filing then, the <a href="https://www.financemagnates.com/terms/e/exchange/">exchange</a> told
the court that the Turkish authorities were unlikely to act on the orders from
the US courts.</p><p>FTX Turkey</p><p>Immediately after the
collapse of FTX, the Turkish Financial Crimes Investigation Board seized the
exchange's assets and began an investigation against its former CEO, Sam
Bankman-Fried. In an official announcement, the Turkish authorities accused FTX
of not preserving customers' trust and faulted Bankman-Fried for suspicious
criminal activities.</p><p>Meanwhile,
at the beginning of the week, FTX proposed to a section of its claimants a plan <a href="https://www.financemagnates.com/cryptocurrency/ftx-officially-floats-plan-to-restart-international-crypto-exchange/" target="_blank" rel="follow">to
relaunch the operations</a> of
the offshore exchange in collaboration with third-party investors, <a href="https://www.financemagnates.com/cryptocurrency/ftx-officially-floats-plan-to-restart-international-crypto-exchange/" target="_blank" rel="follow">Finance
Magnates</a> reported.
According to the court documents, the debtors will forgo their refunds in
exchange for shares in the proposed entity.</p>

This article was written by Jared Kirui at www.financemagnates.com.