FTX Collapse — Client's Funds Recovered Before the Bankruptcy

Before FTX — one of the world's largest cryptocurrency exchanges — filed for bankruptcy in November 2022, our client had been prevented from withdrawing his assets. Acting on early warning signs, we obtained the release of his funds through urgent legal intervention before the exchange collapsed.

The FTX situation

Our client held a significant balance on FTX, the cryptocurrency exchange that collapsed spectacularly in November 2022. Weeks before the collapse, the exchange began imposing withdrawal restrictions on his account, citing compliance reviews. The client had seen no similar restrictions applied to other users and suspected that something was seriously wrong.

Urgent legal intervention

We filed an urgent formal request for the release of our client's assets, supported by documentation establishing that the withdrawal restrictions applied to his account were without legitimate regulatory basis. We simultaneously notified the competent financial authorities of the discriminatory application of withdrawal limits. The pressure of the formal legal challenge prompted FTX to release our client's assets.

The FTX collapse wiped out billions in client assets. Our client was one of the few who got out before the gates closed — because he acted on his instincts immediately and gave us time to intervene.

Outcome

Our client's full balance was released before the exchange collapsed. He suffered no loss from the FTX bankruptcy. Thousands of others who did not act in time are still pursuing claims in the US bankruptcy proceedings years later.