Did You Know $700 Million of Customer Money Will Be Used To Fight Customers? | That’s Legal Fees for FTX, Celsius, Voyager, BlockFi, and Genesis | And You Pay For It
Disclaimer: This looks like financial advice, doesn’t it? You look at it from the right, it looks like I am pushing you to do what is written in the article. If you put your head down and think, you may be convinced that this indeed is financial advice. If you close your eyes, it may seem logical to do what is in the article.
Even then - Do Your Own Research! This is not financial advice! 😊
TLDR | $700 Million From Your Pocket Has Already Gone, Poof
First, these cryptocurrency exchanges defraud people of their life savings, and then to get the money back, legal and bankruptcy proceedings have to be waded through. Net effect – the money required for the legal fees will be coming from the creditors’ pocket, who were to be reimbursed in the first place.
While the intentions of the legal proceedings are novel, and the amount collected will go towards the creditors and customers, most of the recovered money will also be used to pay the legal fees.
And if this is not enough, this is fees incurred so far, and that figure may rise further. By the way, which are the firms causing these craters in people’s pockets? FTX (yeah, that same sleazy guy who wanted to be out of jail for five days a week), Gemini, Voyager, Block-Fi, and Celsius.
The CEXs That Destroyed Lives and Crypto Investors’ Confidence
We all know how 2022 panned out where FTX, Celsius, Gemini, Voyager, and Block-Fi wiped out customers’ and investors’ money and filed for bankruptcy. If that was not enough, now the customers are left to fend for themselves. The firms fighting the bankruptcy case will be recovering their dues from the total money recovered from the CEXs. And who’s money is that? In totality, customers' money. Why? Because the CEXs burned their money already, and that's when they burned through their customers’ money to splurge on their luxuries.
It has been argued that the expenses and charges will be high as lawyers, accountants, consultants, and other professionals will be required to tackle the relatively new blockchain field. The know-how of the blockchain world is minimal, and that, in turn, means time-intensive study and investigations. As such, the $700 million is only bound to increase.
What Now?
It is a sad state of affairs that the aggrieved parties would also be the ones to lose money in the entire legal process. Shouldn’t the personal holdings of the FTX owners, stakeholders, and management be liquidated to fund the proceedings? Why are the customers suffering?
It is just beyond logic, but sadly that’s how things are stacked up now. I do hope the perpetrators of the wrong-doings at least get a long-term sentence. That may still not solve the customers’ loss completely, but will, at least, give them a sense of victory.
Image Courtesy: The Economic Times publication dated 9th September 2023
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