Court allows bankrupt crypto exchange Bittrex to resume customer withdrawals
Bittrex’s U.S. division will resume withdrawals on June 15 after receiving court approval on a plan to pay back customers before the fine.
The Delaware bankruptcy court reportedly ruled June 14 in favor of the company’s plans, denying the Department of Justice’s (DOJ) motion to block the plans. Court submission.
According to the court order, customers with “undisputed, contingent and settled claims” are allowed to withdraw funds from the platform in the form of virtual or fiat currency.
The order also provides that the court’s decision will not have a “preemptive effect” on other bankruptcy cases tried in the United States.
Furthermore, the order does not “determine or resolve” the relative priorities between the Company’s creditors, including U.S. regulators, and its customers with respect to asset ownership and repayment thereof.
This means that even withdrawals may be repossessed by creditors in the future.
fine
On June 7, the Justice Department filed a motion seeking an injunction against Bittrex’s repayment plans, arguing that the company’s creditors, including OFAC and FinCEN, would be adversely affected.
OFAC and FinCEN both fined the company in October 2022 for violating economic sanctions. Both regulators fined the company $24 million and $29 million, respectively.
Bittrex agreed to pay FinCen $24 million, but it still owes two regulators a total of $29 million in fines, making them its largest creditors.
The Department of Justice said in a filing:
“In terms of fairness and impartiality, if OFAC and FinCEN debts cannot be paid in full by verification, the United States should have the opportunity to prove that cryptocurrency assets belong to debtors and can be recovered from customers. ”
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