Bankruptcy Attorney Says Revealing FTX Client Names Will Hurt ‘Potential Reboot’

Lawyers for the Committee of Creditors argued Wednesday that releasing the names of the 9 million bankrupt cryptocurrency exchange clients could hurt the company’s “potential restart”.

It is the latest development within the range Ongoing dispute on whether the names of FTX creditors should be made public. In addition to the privacy concerns, attorneys for the creditors’ committee are now arguing that disclosing these names could harm the value of the company and thus harm creditors.

Chris Hansen, partner of Paul Hastings, an attorney representing the creditors’ committee, said during a court hearing in Delaware.

“For balance, we looked at it and said we have two big missions here,” Hansen said. “One is assessing the value attached to these assets from a sale perspective and assessing the value attached to these assets for a potential reboot is how we have indicated it on our website. Reboot is complex,” he says.

Hastings’ reference to the “value” of the list relates to one of FTX’s arguments against disclosing identifying information about its customers, even under seal. FTX’s restructuring team has asked the judge for permission to keep the listing completely private for the next six months, which they say will give the company time to market the listing as a salable asset to buyers.

At the end of the hearing, US Bankruptcy Judge John Dorsey decided to allow FTX to keep customer names confidential for three months. “I am concerned with protecting the identity of these individuals,” Dorsey said.

Releasing the names of FTX clients, or when to do so, has been a contentious issue since last month.

FTX’s lawyers also argued that the company’s privacy would be harmed if their information was exposed. There is recent precedent for that.

Celsius, which is subject to its own bankruptcy procedures, Names issued, crypto wallet identifiers, types and amounts of transactions, services used by customers, types and quantities of tokens held by customers in 14,500 pages of court filing in October. The data leak caused a lot of backlash on social media.

The FTX bankruptcy case was originally transferred from the Bahamas with The names of the creditors have been revised. But Judge John Dorsey, who is overseeing the proceedings, allowed David Finger, the attorney representing the media, to do so. Argument for dropping names From FTX clients.

FTX’s legal team has suggested that releasing the names could put these clients at risk of personal harm, including kidnapping. US Regency Juliette Sakissian was skeptical.

“Kidnapped? She said Bassem. “We don’t even know what country these people live in.”

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