Bybit's VIP Scandal Legal Action Seeks $953M in FTX Asset Recovery

Bybit’s VIP Scandal: Legal Action Seeks $953M in FTX Asset Recovery

News, Altcoin news

In a legal showdown, FTX’s bankruptcy advisers have initiated legal action against Bybit Fintech Ltd and its affiliates, aiming to reclaim approximately $953 million in cash and digital assets. This amount, allegedly withdrawn from Sam Bankman-Fried’s cryptocurrency exchange before its Chapter 11 filing a year ago, has become the focal point of a complex legal battle.

bybit jpg

According to the lawsuit filed in a Delaware court, Bybit’s investment arm, Mirana Corp., held exclusive “VIP” privileges, a claim that has stirred controversy in the crypto realm. It is asserted that Mirana, leveraging these exclusive benefits, executed the majority of its asset transfers out of FTX just before the exchange’s collapse in November 2022.

The complaint alleges that Mirana exerted pressure on FTX employees to expedite its withdrawal requests, creating a stark contrast with the delays faced by regular customers attempting to withdraw funds during the exchange’s tumultuous period.

The legal battle is fueled by a quest to recover assets totaling around $953 million, with over $327 million allegedly withdrawn by Mirana from FTX in the critical period between the early morning of November 7 and November 8, 2022, when FTX temporarily paused withdrawals.

The defendants in this high-stakes bankruptcy lawsuit encompass Bybit Fintech Ltd., Mirana, a related crypto trading entity named Time Research Ltd, a senior Mirana executive at the time, and Singaporean residents allegedly linked to the FTX withdrawals subject to the lawsuit.

As the legal saga unfolds, the intricacies of the alleged exclusive privileges, withdrawal pressures, and the web of entities involved will undoubtedly be closely scrutinized. Stay tuned for updates on this gripping legal battle that could reshape the narrative around FTX’s bankruptcy and the actions leading up to its Chapter 11 filing.

Bybit, FTX

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