US court approves 3AC's $1.53B claim against FTX

A U.S. Bankruptcy Court ruling in Delaware has allowed liquidators of the collapsed hedge fund Three Arrows Capital (3AC) to raise their claim against FTX (CRYPTO:FTT) from $120 million to $1.53 billion.

The decision is a major development in the bankruptcy proceedings of FTX, which filed for bankruptcy in November 2022.

Chief Judge John Dorsey rejected FTX’s objections, stating that delays in filing the amended claim were largely due to FTX's failure to provide necessary records.

"The evidence suggests that the delay in filing the Amended Proof of Claim was, in large part, caused by the Debtors themselves," he noted.

3AC liquidators originally filed a $120 million claim in June 2023 but expanded it in November 2024, citing breach of contract, unjust enrichment, and breach of fiduciary duty.

They argue that FTX liquidated $1.53 billion in 3AC assets in 2022 to settle $1.33 billion in liabilities, a move they claim was avoidable and harmful to 3AC's creditors.

FTX contended that the amended claim was untimely and insufficient, but Judge Dorsey ruled that 3AC had provided proper notice and acted diligently in pursuing necessary information.

This ruling underscores the complexities of crypto bankruptcies and asset recovery efforts.

3AC’s collapse in June 2022 triggered widespread liquidations across the industry, affecting firms such as Genesis and BlockFi.

As FTX continues its recovery process, the decision highlights the lasting financial and legal consequences of the failures of major crypto entities.

With the increased claim approved, 3AC liquidators now have the opportunity to seek significant compensation, further shaping the ongoing legal battles in the crypto sector.

At the time of reporting, the FTX (FTT) price was $1.32.