By George Ward
Following the recent scam scandal surrounding one of the top crypto exchanges, FTX International, the exchange continues to struggle to sustain its good reputation. The exchange announced to the public, subsidiaries, and staff that all their lost funds and owed wages would be paid back in full, and there should be no need to panic.
On Monday, FTX.com, a subsidiary of FTX Trading Limited, revealed that it was “carrying out checks and balances to start payment of benefits and salaries.”
FTX employees from different parts of the world and some non-US service providers and contractors will start receiving partial payments. However, this new development isn’t directed at any firm or staff linked with FTX.US.
Australia and the Bahamas Are Omitted
FTX’s newly appointed chief executive, John Ray, has revealed that the payments to be made have the court’s approval. John Ray also stated that the crypto exchange has started working on global cash management firms.
Hence, the payments would be according to the limits approved by the Bankruptcy Court. However, there would also be cash payment due to part of the limits imposed on FTX after the bankruptcy filing date.
Nevertheless, there will be some jurisdictions that won’t be included in the payments. For example, the company will only pay contractors that the company still owes and employees in the Bahamas.
This means contractors of the exchange’s Bahamas subsidiary and its employees will be excluded from the payment because it’s according to a separate liquidation process unrelated to Chapter 11.
This same policy applies to FTX branches in Australia because FTX Express Pty Ltd and FTX Australia Pty Limited were separate entities not included in the United States Chapter 11 filing. This comes after a motion was filed on November 19 by FTX debtors for pre-petition compensation, benefits to employees and contractors, and payments.
Also, no payment will be given to FTX’s former CEO and founder Sam Bankman-Fried and other top members of the team like Caroline Ellison, Nishad Singh, and Gary Wang. Meanwhile, individuals or firms eligible to get paid will receive nearly three weeks of pay which was stopped with the bankruptcy filing at the beginning of this month.
The new CEO has hinted that the exchange’s assets might be up for sale, freeing up more cash for stakeholders. But Ray thinks the move will take time to get achieved.