According to a recent court document, the insolvent crypto exchange FTX may have more than one million creditors.
Sam Bankman-Fried’s crypto exchange, FTX, which filed for bankruptcy last week, estimated that it may have more than a million creditors, illustrating how challenging it will be to resolve this insolvency.
There are more than 100,000 creditors in these Chapter 11 cases, according to a court document that was added to the federal court database system on November 15. In actuality, there might be a million or more creditors.
The failed crypto exchange group, which also includes sister trading firm Alameda Research, filed more than 100 dockets, and FTX filed motions to group entities together rather than individualize the cases.
According to the filing, the debtors submit a cause of action to modify that requirement such that the debtors will file a consolidated list of their top 50 creditors.
The operators of FTX are also asking for the option of serving bankruptcy notices to creditors via email rather than in person because their customers’ email addresses are already in the system.
The exchange claims it has spoken with the U.S. Attorney’s Office, the Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC), among others, about last week’s hundreds of millions of dollars in unusual crypto outflow.
Some have theorized that the outflows were caused by a hack or an inside job, but the cause is still unknown.