United

Circuit

<ul>
 <li>Ruling of Judge John Dorsey of the U.S. Bankruptcy Court was overturned.</li>
 <li>The court found that prospective investors would benefit from more clarity.</li>
</ul>
An independent examiner was ordered to be appointed by the court presiding over the bankruptcy of <a href="https://thenewscrypto.com/asset-management-firm-ikigai-liquidates-65m-claim-in-ftx/" target="_blank" rel="noopener noreferrer nofollow">FTX</a> crypto exchange by the United States Court of Appeals for the Third Circuit, months after the initial filing.
Ruling of Judge <a href="https://www.deb.uscourts.gov/content/judge-john-t-dorsey" target="_blank" rel="noopener noreferrer nofollow">John Dorsey</a> of the U.S. Bankruptcy Court for the District of Delaware was overturned by three judges of the <a href="https://www.ca3.uscourts.gov/" target="_blank" rel="noopener noreferrer nofollow">Third Circuit</a> on January 19. Thus, compelling the court to choose an examiner to monitor the FTX bankruptcy case. The appeals process began in February 2023. This was when Judge Dorsey dismissed Andrew Vara’s petition to appoint an examiner in FTX’s bankruptcy case.
<h3 class="wp-block-heading" id="h-more-clarity-for-investors">More Clarity for Investors</h3>
Moreover, the court found that prospective investors would benefit from more clarity “for the evolving and volatile cryptocurrency industry” if an impartial examiner were to monitor the FTX bankruptcy case. Also, in its decisions concerning FTX’s reorganization plan, the bankruptcy court would be able to “consider the greater public interest” if an independent exploration were conducted, according to the Third Circuit.
The ruling mentioned:
<blockquote class="wp-block-quote">
 “An investigation into FTX Group’s use of its own cryptocurrency tokens, FTTs, to inflate the value of FTX and Alameda Research could bring [the crypto industry] under further scrutiny, thereby alerting potential investors to undisclosed credit risks in other cryptocurrency companies.”&nbsp;
</blockquote>
In November 2022, not long after <a href="https://thenewscrypto.com/latest-ftx-trial-exposes-sbfs-political-connections-dark-secrets/" target="_blank" rel="noopener noreferrer nofollow">Sam Bankman-Fried</a> resigned and John Ray was named CEO to manage the bankruptcy, FTX filed for Chapter 11 protection. Bankman-Fried was convicted of seven offenses in November 2023. In March, he is likely to be sentenced.
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Court Orders Independent Examiner in FTX Bankruptcy Case

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