Failed cryptocurrency exchange FTX recently launched its claims portal, allowing users from around the world to file a claim.
However, the portal stayed live for around an hour before going offline for unknown reasons, leaving users in the lurch.
Claims Portal Goes Live
According to users on social media, the FTX claims portal went live on the 11th of July, with the page stating that users have until the 29th of September to submit their respective claims.
“Except as otherwise provided herein, all persons and entities, (including, without limitation, individuals, partnerships, corporations, joint ventures, and trusts) that assert a Customer Claim against any of the Debtors which arose on or prior to the Petition Date must file a proof of such claim so that it is actually received by Kroll Restructuring Administration LLC, the Debtors’ noticing and claims agent (the “Claims Agent”), on or before 4:00 p.m. (Eastern Time) on the 29th of September, 2023 (the “Customer Bar Date”).”
The claims portal allowed customers of the bankrupt exchange to access their account information, following which they could file a petition which would be included in FTX’s Chapter 11 bankruptcy proceedings. The claims portal is for those customers who had accounts with FTX.com, FTX.us, Blockfolio, FTX EU, FTX JP, and cryptocurrency exchange Liquid.
According to instructions available on the claims portal when it was online, customers would be redirected to the Kroll Restructuring Administration platform, where they would have to confirm their balances and submit an electronic proof of claim.
“You will be directed to the Kroll Restructuring Administration platform to confirm your balances as of the Petition Date and, if necessary, submit an electronic proof of claim.”
And Then Goes Offline
However, barely an hour after it went online, the claims portal went offline for unknown reasons, leaving users dumbfounded. Before it went offline, the claims portal stated that users would be able to access their account balances as they were on the 11th of November, which was the day the FTX exchange filed for bankruptcy. However, users still have the option of filing their proof-of-claim through US mail and Kroll’s online customer form. At the time of writing this report, the claims portal is still offline.
The debtors’ party to the FTX bankruptcy case had announced in June that they were planning to launch a claims portal to handle customer claims and stated they would announce when the portal goes live.
“The FTX Debtors’ “Customer Bar Date” has been set for the 29th of September, 2023, at 4 p.m. ET. To streamline the process for customers, the FTX Debtors are finalizing an online claims portal at FTX Debtors will announce when the portal is active.”
The FTX Collapse
FTX was one of the most prominent cryptocurrency exchanges and suffered a spectacular collapse in November 2022, filing for Chapter 11 bankruptcy. The exchange suffered a crippling liquidity crisis at the time, as fearful customers pulled an estimated $6 billion from the exchange amidst concerns that their assets were at risk. The news that the FTX exchange and its sister concern Alameda Research had been sharing their assets in a bid to boost their balance sheets only served to hasten the collapse.
The bankruptcy proceedings are currently ongoing in a Delaware court. Meanwhile, Sam Bankman-Fried’s trial for allegations of fraud is set to begin in October, with the former CEO set to be tried on 8 criminal charges for now. FTX is estimated to owe its creditors over $3 billion, with prosecutors alleging that Bankman-Fried co-mingled customer assets and misled investors about FTX’s risk management strategies and practices.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
