Nikolas Gierczyk, a California resident, is suing hedge fund Olympus Peak, alleging that the company owes him another recovery based on his sale of his claims against the fallen crypto exchange FTX.
Olympus Peak, however, has refused to honor its part of the agreement, according to Gierczyk, allowing it to retain his rights to future recovery from the transaction it had with him.
Olympus Peak paid Gierczyk $930,000 for a $1.59 million $1.59 million claim against the bankrupt exchange that it sold him at 42 percent off. But after the Cryptocurrency Exchange was approved to reorganize recently, customers should get between 129 and 146 per cent of their original claim.
FTX Bankruptcy Distribution Overview
Gierczyk’s claims purchased by Olympus Peak could yield anywhere between $2 million and $2.3 million in claims, potentially turning a profit of greater than 1 million dollars.
To get money into the hands of creditors, FTX’s reorganization plan was approved by U.S. Bankruptcy Judge John Dorsey on October 7.
John J. Ray III, CEO of FTX, said that non-governmental creditors will receive “100% of bankruptcy claim amounts plus interest” and that “the distribution of the bankrupt estate asset funds’ expected to be the largest and most complex bankruptcy estate asset distribution in history.”
These positive developments have sparked some creditors, like Sunil Kavuri, to claim that the plan doesn’t tackle enough the token gains from November 2022 to 2024. On September 28, Kavuri said creditors could expect to recover between 10 percent and 25 percent of their cryptocurrency investments under the new scheme.
During the turmoil, many FTX users like Gierczyk sold their claims to hedge funds. During 2022, the year in which countless crypto firms such as FTX, Celsius Network, BlockFi, and Voyager Digital declared bankruptcy , hedge funds and other debt investors began buying claims from affected users.
According to Cherokee Acquisition, more than $600 million in FTX claims have been sold to date on marketplaces like Xclaim; more than 10,000 claims were listed.
