The names of up to nine million FTX customers are set to remain confidential for at least three months after the latest decision in FTX bankruptcy proceedings.
The decision was announced by Judge John Dorsey in bankruptcy court in Delaware on January 11 in response to a 168-page filing by FTX on January 8, which asked the court not to withhold confidential customer information.
Judge Dorsey said he remains “reluctant at this time” to disclose confidential information, as it could put creditors “at risk,” despite increased pressure from some media:
“We’re talking about individuals here who don’t exist — individuals who may be at risk if their names and information are revealed.”
The day before, FTX lawyers argued “that the disclosure of the information would create a risk of identity theft or unlawful injury to individuals or individual property” and that the court should use “broad discretion” under the US Bankruptcy Code to protect those people. affected by the collapse of FTX.
In late December, a group of non-US FTX customers also pushed a Delaware bankruptcy court to keep customer information private, arguing on December 28 that combined public disclosure would cause “irreparable harm.”
Judge Dorsey’s decision however does not go contrary to most bankruptcy proceedings where creditor information is disclosed – which is what happened in the cryptocurrency creditor Celsius bankruptcy proceedings in October.
related: Getting funds out of FTX can take years or even decades: Lawyers
The Delaware-based bankruptcy court did not agree with the equity holders of FTX, which had released a document on January 9 that disclosed the investors expected to be liquidated and the number of shares they held with FTX.
Among those included NFL legend and former FTX brand ambassador Tom Brady, ex-wife Gisele Bündchen, tech entrepreneur Peter Thiel and Shark Tank investor Kevin O’Leary.
It appears that progress is being made, with FTX reportedly having recovered $5 billion in cash and cryptocurrency, FTX attorney Andy Dietderich said in a January 11 statement.
According to the initial bankruptcy filing in November, more than 1 million creditors were speculated to be involved, with $3 billion owed to the 50 largest creditors alone.