Turkey Detail in the FTX Case: It Should Be Removed from the File!

Cryptocurrency exchange crashed in November FTXfiled a new claim in pending bankruptcy court. The lawyers demanded that the Turkish branch be removed from the bankruptcy case, arguing that it had “no legal or practical impact” in Turkey.

In a filing Friday, FTX claimed that “there is no reason to believe that the Turkish government will comply with the orders of this Court”, meaning that the exchange “could not exercise sufficient control” over Turkish officials to comply with its duties under the Bankruptcy Law.

Shortly after FTX filed for “Chapter 11” bankruptcy in November, the Treasury and Finance Department led a special investigation for FTX Turkey and confiscated assets.

As detailed in the filing, the Turkish branch is 80% owned by FTX Trading Ltd, the remaining 20% ​​of the equity capital belongs to SNG Investments, an indirect subsidiary of Alameda Research LLC operating as a market maker.

In the dossier, both FTX Turkey and SNG Investments are defined as “non-strategic” for the exchange’s global operations. In the file, it was added that the local laws valid in Turkey are also applied.

The exchange argues that this also means that any assets of FTX Turkey in the country can be subject to these specific requests and transactions, and that local authorities can use them to enforce any decision of Turkish courts.

Given all these reasons, FTX believes that it would be in the interests of both creditors and debtors to have its assets in Turkey dismissed, and that continuing the lawsuit would “waste scarce resources and accumulate unnecessary fees.”

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