FTX Express Pty Ltd and FTX Australia Pty Ltd - Case Update

The Supreme Court of Victoria has issued a key ruling in the administration of FTX Express Pty Ltd and FTX Australia Pty Ltd, clarifying that only those customers that made unfulfilled withdrawal requests of fiat currency in AUD at the time of the administrators’ appointment have claims against FTX Express. The Court rejected arguments that customers who simply held a positive AUD balance at the time of the appointment were creditors of FTX irrespective of whether they had made a fiat withdrawal request prior to that time. Instead, the Court found that once a customer’s AUD fiat deposit with FTX Express was credited to their account on FTX.com, the customer received equivalent value in the form of digital, electronic or other form of non-fiat currency that was then available to be used to buy, sell or trade crypto-assets. A debtor-creditor relationship would only exist if the customer’s deposit was not converted and never credited to their account on the FTX.com platform. This ruling will significantly limit the claims against the companies and the creditors entitled to vote at the second meeting. Read the decision here.