ARTICLE AD BOX
Key Takeaways
- Alameda requested an order compelling Crypto.com to release $11 Million
- As per court documents, Alameda had opened the account under the name “Ka Yu Tin” before FTX declared bankruptcy in November 2022.
Alameda Research, a firm which worked as the now defunct FTX’s main market maker has initiated legal proceedings to recover more than $11 million held in a Crypto.com account.
In a recent filing on November 7 with the U.S. Bankruptcy Court for the District of Delaware, Alameda requested an order compelling Crypto.com to release these funds, arguing that they belong to the bankrupt estate and are not of minor value.
As per court documents, Alameda had opened the account under the name “Ka Yu Tin” before FTX filed for bankruptcy in November 2022. Following FTX’s collapse, the account was reportedly locked by Crypto.com, preventing Alameda’s administrators from accessing the assets.
The filing claims that despite multiple attempts to clarify the ownership and provide necessary documentation, Crypto.com has refused to cooperate, citing discrepancies in the account’s registration details.
A declaration by Caroline Ellison, the former CEO of Alameda Research, has added weight to the request. Ellison, who provided her statement on November 1 before starting her two-year prison sentence, asserted that the funds in the Crypto.com account were the property of Alameda. She added that the $11.4 million in question is significant to the bankruptcy estate and should be released to aid in the company’s ongoing efforts to repay creditors.
The filing notes that the company often opened accounts under pseudonyms or in the names of employees, a tactic meant to obscure trading activities. However, FTX’s legal team maintains that the assets in these accounts were controlled by Alameda and are critical for the estate’s recovery plan.
In addition to seeking the release of the Crypto.com funds, FTX is challenging claims made by firms associated with Crypto.com’s parent company. Foris MT and Iron Block, two related entities, have filed claims against FTX totaling $18.4 million and $237,800, respectively. FTX has requested that these claims be put on hold until the disputed $11 million is returned.
This legal action is part of broader efforts by FTX’s bankruptcy estate to recover assets held by third-party exchanges. In October, Alameda also filed a lawsuit against KuCoin to retrieve about $50 million in frozen assets.