- FTX has filed lawsuits against NFT Stars and Delysium for failing to deliver owed tokens.
- The complaints aim to recover assets from Alameda Ventures promised under SAFT agreements.
- FTX plans further legal action to maximize creditor recoveries ahead of its $16B repayment plan.
In a dramatic twist, the now-defunct exchange, FTX, had taken legal action against two token issuers for failing to deliver the promised digital assets. On Monday, FTX Trading Ltd. and the FTX Recovery Trust filed lawsuits in the U.S. Bankruptcy Court in Delaware against NFT Stars Limited and KUROSEMI INC. The latter operates under the name Delysium.
The lawsuits claimed that both firms failed to deliver the digital tokens promised to FTX under investment agreements. These deals, known as Simple Agreements for Future Tokens (SAFTs), were made with Alameda Ventures. Notably, Alameda was the venture arm of Alameda Research, affiliated with FTX.
In its statement, FTX pointed out that it had sought to resolve the matter several times, but since there has been no improvement, the case has been filed to compel the companies to transfer the owed tokens. The complaints also seek damages for breach of contract and sanctions for violating the U.S. bankruptcy protections.
According to the FTX Estate, it will continue litigation against other unresponsive token and coin issuers. FTX is currently reaching out to other projects, believing that they possess assets belonging to the company, and warned that lawsuits would be imposed on those entities that fail to comply.
In a public statement, FTX stated that it remains committed to maximizing asset recovery for the benefit of all creditors. “We urge token and coin issuers to return assets that rightfully belong to FTX,” it stated.
This legal move is part of a broader strategy by FTX to reclaim billions lost before the company’s collapse in November 2022. FTX filed for bankruptcy following revelations that customer funds were used to support risky trades made by Alameda Research.
Related: FTX to Pay $11.4B Creditor Payouts With 2022 Valuations
The asset recovery effort has already made progress. According to recent updates, over 90% of small creditors with claims under $50,000 have been repaid. Further, FTX would launch a $16 billion cash distribution from May 30, 2025, which would enhance the liquidity conditions within the crypto market.
However, some Chinese creditors worry about obtaining access to crypto platforms like BitGo and Kraken. The limitations could have an impact on when and how the recipients receive their money. Moreover, the FTX Recovery Trust has partnered with several legal and financial advisory firms for the cause, including Sullivan & Cromwell LLP, Alvarez & Marsal, and Quinn Emanuel Urquhart & Sullivan.
