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Customers Sue FTX for Priority Repayment After Technical Issues Freeze Accounts

FTX customers filed lawsuit against the crypto exchange

Former customers of the now bankrupt cryptocurrency exchange FTX have filed a class action lawsuit against the company and its executives, including Sam Bankman-Fried, seeking priority rights to repayment before non-customer creditors.

The plaintiffs allege that a group of FTX executives failed to put in place adequate controls to protect customer assets, leading to the misappropriation of billions of dollars in customer funds and digital assets.

According to bankruptcy filings, FTX Trading Ltd. and its affiliates owe their 50 largest creditors around $3.1 billion.

The US Department of Justice has also launched a criminal probe into the $372 million stolen from FTX after it filed for bankruptcy and has managed to freeze a portion of it.

The fall of FTX, formerly the second-largest crypto exchange in the world, has had a ripple effect on various businesses and contributed to widespread job cuts in the industry.

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