Sam Bankman-Fried and Ryan Salame, two FTX executives. According to Bahamian attorneys, they allegedly spent $256.3 million purchasing and maintaining 35 different homes in New Providence, Bahamas.
Now, Bahamas officials are attempting to seize control of the property. They want to take it away from FTX’s U.S. bankruptcy proceedings, arguing to a Delaware federal judge that doing so would be administratively ineffective and against Bahamas law.
It is the first actual look at FTX’s enormous real estate expenditures from the inside. Bankman-Fried spent tens of millions of dollars on the small island development where he lived. At the same time, FTX’s holding company spent over $143 million buying at least 15 houses and one vacant lot.
At that exclusive Albany complex, two of the most significant units cost a staggering $30 million, while another was bought for little more than $21.3 million.
Bankman-Fried and Salame additionally spent over $25 million on purchases at the Veridian Corporate Center. In addition, they invested millions of dollars into the property for their present headquarters structure. FTX started construction on a new headquarters in April after putting it on hold after the exchange declared bankruptcy in November.
Regulators in the Bahamas are now battling to reclaim those assets from FTX’s American management. The Bahamian attorneys requested that the Chapter 11 proceedings for FTX’s property subsidiary be dismissed. He asked for it in a Monday night petition to a U.S. judge.
Attorneys for the Bahamas argued before the court that the U.S. bankruptcy proceedings should be suspended. Moreover, Bahamas regulators should be given complete authority over the Bahamian real estate process. They claimed all of the property was located in the Bahamas because “Bahamian law does not allow recognition of a foreign insolvency proceeding for a Bahamian company.”
CEO of FTX and the lawyers expected to oppose the move
The CEO of FTX, John J. Ray, and the U.S. lawyers are expected to oppose the move. Since they have vowed to maximize recovery for their clients through asset sales and restructuring domestically and internationally. Attorneys from the United States and the Bahamas have been arguing about jurisdiction, one side accusing the other of wrongdoing.
After CoinDesk reported substantial discrepancies in sibling hedge fund Alameda Research’s balance sheets. FTX filed for bankruptcy protection on November 11. A last-ditch attempt by Binance to save the day finally failed, leading to a bank run and a significant liquidity crisis for exchange once hailed as crypto’s savior.
Following American authorities’ filing of accusations against him, founder Bankman-Fried is currently held in a Bahamian jail.
The threat of crisis still hangs over the whole crypto industry. November saw the bankruptcy filing of BlockFi. Exchanges worldwide have “paused” or “frozen” redemptions and withdrawals. Even as crypto businesses produce allegedly audited proof-of-reserves to boost investor trust, rumors circulate about which exchange, if any, will be the next to collapse.