FTX‘s Unrelenting Pursuit: Lawsuits Against NFT Stars and Kurosemi
In its ongoing battle to reclaim assets following its spectacular downfall, bankrupt crypto exchange FTX has launched legal action against two prominent players in the NFT and gaming space: NFT Stars and Kurosemi, which operates as Delysium. The lawsuits, filed in Delaware bankruptcy court, allege that both companies are holding onto tokens that were rightfully purchased by FTX, fueling the narrative of a determined exchange seeking to recover what it believes is rightfully owed.
The lawsuit against NFT Stars, a leading NFT marketplace, centers around a $325,000 purchase made by FTX in November 2021 for 1.35 million SENATE tokens and 135 million SIDUS tokens. Despite initial deliveries, FTX asserts that NFT Stars halted the delivery of the remaining 831,000 SENATE tokens and 83 million SIDUS tokens, citing the bankruptcy proceedings as the reason. FTX maintains that this stoppage was unwarranted and argues that NFT Stars should have delivered the full amount, given that the tokens were already purchased.
In the lawsuit targeting Kurosemi, FTX claims its former trading arm, Alameda Research, shelled out $1 million in January 2022 for 75 million of the company’s AGI tokens. While the initial token launch occurred in April 2023, FTX alleges that the original vesting schedule for Alameda Research’s share of the tokens was extended from 12 to 48 months and ultimately suspended due to FTX‘s bankruptcy. FTX insists that Kurosemi should have honored the original schedule, regardless of the exchange’s downfall, leading to a further claim of withheld assets.
FTX‘s Demands: Tokens and Damages
FTX‘s lawsuits seek the return of the remaining tokens in question, but they go beyond mere retrieval. The company also seeks damages, arguing that the tokens, had they been delivered on time, could have been sold at peak values, generating substantial profits. Indeed, the price trajectory of these tokens demonstrates the potential for significant losses. Delysium‘s AGI token reached a peak price of $0.672 in May 2024, but has since plummeted by 90%, trading at $0.067. Similarly, SENATE, which hit $5.85 in January 2022, has lost a staggering 99% of its value, while Sidus, reaching a top price of $0.19 in January 2022, has also suffered a 99% decline.
A Pattern of Recovery Efforts
The legal actions against NFT Stars and Kurosemi are part of a broader strategy by FTX to claw back funds that it believes are owed to the collapsed exchange. Last November, FTX initiated a series of lawsuits, including one against SkyBridge Capital and its founder, Anthony Scaramucci, aimed at recouping funds spent by former FTX CEO Sam Bankman-Fried on sponsorship and investment deals. Another suit was filed against crypto exchange Binance and its former CEO, Changpeng Zhao, seeking the recovery of $1.76 billion worth of cryptocurrency transferred to Binance as part of a 2021 repurchase agreement.
These legal battles reflect the complexities of FTX‘s ongoing bankruptcy proceedings and the efforts to untangle the intricate web of transactions and obligations that led to the exchange’s collapse. It remains to be seen how these lawsuits will unfold, but they underscore the determination of FTX to recover as much of its lost assets as possible, even as the crypto industry continues to navigate the fallout from its demise.
