The judgement follows a Jan. 8 filing by FTX’s lawyers, who contended that public publication might put FTX creditors at risk of identity theft or criminal harm.
Following the latest judgement in the FTX bankruptcy proceedings, the names of up to nine million FTX customers are expected to remain confidential for at least three months.
Judge John Dorsey in the Delaware-based bankruptcy court allegedly issued the judgement on Jan. 11 in response to FTX’s 168-page filing on Jan. 8 requesting the court to withhold personal customer information.
Despite mounting pressure from various media sites, Judge Dorsey stated he is “reluctant at this point” to publish the sensitive material because it may put creditors “at risk.”
“We’re talking about individuals here who are not present – individuals who may be at risk if their name and information is disclosed.”
FTX lawyers argued days earlier that “disclosure of the information would create an undue risk of identity theft or unlawful injury to the individual or the individual’s property,” and that the court should use its “broad discretion” under the U.S. Bankruptcy Code to protect those affected by the FTX collapse.
In a Dec. 28 joinder filing, a group of non-U.S. FTX customers also urged the Delaware bankruptcy court to privatise customer information, stating that public revelation would create “irreparable injury.”
However, Judge Dorsey’s judgement goes against most bankruptcy processes in which creditor information is revealed, as happened in cryptocurrency lender Celsius’ bankruptcy proceedings in October 2022.
The Delaware-based bankruptcy court has been harsher on FTX stock holders, releasing a document on Jan. 9 detailing the investors who are expected to be wiped out and the quantity of shares they held with FTX.
NFL icon and former FTX brand ambassador Tom Brady, his ex-wife Gisele Bündchen, tech billionaire Peter Thiel, and Shark Tank investor Kevin O’Leary were among those in attendance.
However, it appears like progress is being made, with FTX having recovered $5 billion in cash and cryptocurrencies as of Jan. 11, according to FTX attorney Andy Dietderich in a statement.
According to early November bankruptcy filings, more than 1 million creditors were suspected to be involved, with $3 billion due to the top 50 creditors alone.
