3 months ago 1 min read

US Trustee Opposes FTX's Proposed Sale of LedgerX and Other Assets

ftx-ledgerx-sam bankman

The idea of FTX to sell LedgerX as well as FTX units in Europe and Japan has been objected to by a U.S. trustee.

Due to rising debt from unsuccessful investments and allegations of financial misconduct by senior business leaders, FTX filed for bankruptcy protection in November.

The corporation previously announced its intention to sell its LedgerX, FTX Japan, and FTX Europe operations. According to Reuters, U.S. Trustee Andrew Vara objected to these sales on January 7.

The federal bankruptcy inspector asked for an examination to be carried out before the sale of the units in order to determine whether they had access to information about FTX's bankruptcy proceedings in his filing.

The filing stated that until there has been a thorough and independent investigation into all persons and entities that may have been involved in any malfeasance, negligence, or other actionable conduct, the sale of potentially valuable causes of action against the Debtors' directors, officers, and employees, or any other person or entity, should not be permitted, according to Reuters.

Vara serves as a U.S. trustee for the Department of Justice, which oversees bankruptcy cases in the country. Vara is responsible for making sure that insolvent corporations are not acting in a way that might harm creditors or other parties having stakes in the case.

The change occurs after Sam Bankman-Fried, the former CEO of FTX, entered a not guilty plea to accusations that he defrauded investors and caused them financial damage last week.

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