The downfall of FTX with the events that followed suit has been one of the most high-profile cases. Media outlets from all across the globe have been monitoring the firm and the people involved. Talking about the individuals involved, users of the now-defunct exchange certainly played a prominent role. However, the identities and the wallet balances of its customers were under wraps.
In a surprising turn of events, major media firms banded together to argue against the need to keep their non-U.S. customers’ names a secret. This is in context of the FTX’s bankruptcy proceedings. A joint complaint was filed regarding the same by Bloomberg, The Financial Times, The New York Times, and its parent business, the Dow Jones & Company.
These media outlets further protested the concealment of the customers’ identities. According to them, the people and the press both have the “presumptive right of access to bankruptcy filings.”
In this filing, the media sources argued that “sealing customers’ names would be routine in virtually every bankruptcy proceeding” if the “permanent sealing” of the users were legal under the justifications invoked by FTX and the Committee.
What will happen if these FTX customer identities come to light?
Firstly, if the media houses succeed, a whopping 1.4 million identities as well as their balances on FTX will be revealed.
In a document filed on Dec. 28, the Ad Hoc Committee of Non-US Customers of FTX noted the perils of this situation. The agency asserted that making non-U.S. customers’ identities and confidential information public exposes them to identity theft, and targeted assaults.
Additionally, these sources claimed that FTX and its clients have not been able to “justify such secrecy.” They emphasized how the firm’s borrowers were effective in seeking the creditors’ identities. The filing further read,
“The sealing of the names of FTX’s creditors to date has significantly impeded reporting on, and analysis of, these proceedings, leaving the public—and creditors— largely in the dark as to the United States’ enforcement of its bankruptcy laws in the crypto context.”
Furthermore, the case is scheduled to be heard on April 12 at 1:00 p.m. Eastern Time.