March 27, 2024
Attestor Capital Drags FTX Claim Seller to Court as Bitcoin Surges
Policy & Regulation

Attestor Capital Drags FTX Claim Seller to Court as Bitcoin Surges

Lawsuit Over FTX Bankruptcy Claims

The collapse of the FTX exchange continues to play out in the bankruptcy claims market, with Attestor Capital, a top FTX claim holder, filing a lawsuit against one claim seller.

Attestor is a London-based hedge fund focusing on distressed assets and private equity. The firm has emerged as one of the biggest buyers of FTX’s bankruptcy assets alongside Silver Point Capital and Diameter Capital Partners.

As of February, Attestor was the largest FTX claims buyer, purchasing at least $400 million worth of claims, according to the Claims Market data.

Cumulative holdings of top six FTX claims holders. Source: Claims Market by Cherokee Acquisition

Lawsuit Over Canceled $58M Deal

After making a 200% profit on its FTX claims stash, Attestor filed a lawsuit against Lemma Technologies, the seller of one of the biggest FTX accounts that it purchased, Bloomberg reported on March 18. According to Attestor, Lemma agreed to sell FTX claims to the company at the price of $58 million in June 2023.

The company then backed off from the deal amid soaring cryptocurrency prices, with Bitcoin surging nearly 130% over the past year at the time of writing. Panama-based Lemma eventually decided to keep the claim for itself, Attestor reportedly said in the lawsuit, alleging that that was a clear case of “seller’s remorse.”

Lemma’s Silence and Attestor’s Allegations

According to Bloomberg, Lemma has not publicly explained its side of the case and hasn’t filed a defence against Attestor’s New York suit. “Lemma won’t “proceed with the transactions or otherwise honour the trade confirmations,” Attestor lawyers said in their filing, “unless compelled by force of law to do so.”

While Lemma is facing a new lawsuit in New York, one of its key people has also faced legal issues in South Korea. Lemma’s principal investor, Junho Bang, is accused of stealing digital assets from the collapsed crypto lending firm Haru Invest and was reportedly indicted by South Korean authorities after being arrested in January.

Haru Invest Collapse and Allegations

Haru Invest ran a cryptocurrency yield platform, promising investors 12% yearly on cryptocurrency deposits. The platform abruptly suspended withdrawals in June 2023, citing issues with service partners.

South Korean prosecutors subsequently arrested Haru Invest’s CEO and two other executives for stealing $830 million from thousands of customers.


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