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In a bid to expedite the recovery process for FTX and its stakeholders, Sam Trabucco, the former co-CEO of Alameda Research, has made a pivotal decision. In a recent filing, he has agreed to forfeit assets worth millions.
This decision marks a key moment in the ongoing FTX bankruptcy saga as it seeks to close chapters and resolve outstanding claims.
Sam Trabucco’s Settlement Proposal: ADeal to Avoid Legal Battles
As part of the agreement, Trabucco will transfer ownership of his luxury assets to the bankrupt FTX entities. This includes a yacht, two upscale San Francisco apartments, and relinquishing his claims worth $70 million. These assets will be used to support the resolution of FTX’s debts.
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In June 2023, Trabucco lodged $70 million in claims against FTX and its affiliated entities. Under the new agreement, Trabucco will relinquish all rights to these claims, which will now be disallowed and expunged.
This settlement avoids prolonged litigation, promising a swifter resolution for creditors.
FTX and Alameda’s Close Ties
FTX and Alameda Research have been entangled in controversy, with former FTX CEO Sam Bankman-Fried at the helm of both companies. Caroline Ellison, another former co-CEO at Alameda, was previously noted for her close relationship with FTX.
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Trabucco resigned in August 2022, only months before both companies collapsed. This marked a clean exit just as FTX’s underlying issues began surfacing.
The settlement between Trabucco and FTX marks another significant step in addressing the fallout from one of the biggest bankruptcies in crypto history.
FTX’s Reorganization: A Slow Recovery
FTX’s bankruptcy proceedings have been ongoing since the company’s dramatic collapse in 2022. In October, a U.S. bankruptcy judge approved FTX’s plan to distribute funds to its creditors.
Under the plan, 98% of creditors are set to receive at least 118% of their claim value. However, the reorganization proposal faced criticism over plans to distribute funds in cash rather than cryptocurrencies, a point of contention among creditors.
As the liquidation process continues, creditors are inching closer to receiving compensation. But the road ahead remains rocky for FTX’s legacy and its troubled ties with Alameda Research and other key industry leaders.
