FTX and Alameda Research have agreed to settle their litigation with the CFTC and pay creditors $12.7 billion.
The settlement, approved by Judge Peter Castell, ends a 20-month legal battle and carries no civil penalties. The agreement prohibits future transactions between #FTX and Alameda to prevent a recurrence of misconduct in the digital asset trading industry.
FTX and Alameda Research reached a settlement with the U. S. Commodity Futures Trading Commission (CFTC) and agreed to pay $12.7 billion to creditors. The settlement ends a 20-month legal battle and the total compensation, excluding civil penalties, will be paid only in the form of loans or refunds.
Judge Peter Castell's approval of the settlement is significant for #cryptocurrency regulation and compliance.
After a lengthy legal battle, FTX and its sister company, Alameda Research, settled their dispute with the CFTC by paying a significant fine. The plan was filed on July 12, and on August 7, federal district judge Peter Castell issued a final ruling.
the settlement allows the companies to focus on returning funds to defrauded investors and bankruptcy settlement. As part of the settlement agreement, FTX and Alameda are ordered not to commit any more fraudulent acts with respect to their #digital assets.
nnIn addition, the companies must pay $8.7 billion in restitution to investors defrauded by Sam Bankman Fried, and another $4 billion must be forfeited. This total amount of restitution further underscores the seriousness of the fraud and the regulator's commitment to investor protection.
The settlement closes the curtain on FTX and Alameda and paves the way for future compliance with digital asset rules.
The outcome of this litigation is also important to FTX's creditors. Under the proposed restructuring plan, 98% of creditors with claims of less than $50,000 will receive a payout equal to 118% of the value of FTX's assets at the time of the bankruptcy filing.
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