FTX Issues Clarification on Backpack's Acquisition Announcement and Related Misinformation

FTX Clarifies Misleading Statements about Backpack’s Acquisition of FTX EU

In a recent announcement, FTX Trading Ltd. and the FTX Recovery Trust provided a crucial clarification regarding allegations made by the Backpack entities concerning Backpack's purported acquisition of FTX EU Ltd. This clarification comes after Backpack issued a press release on January 7, 2025, which was released without FTX's authorization and included numerous misleading statements.

Key Points of Clarification

FTX has expressed its concern about the confusion surrounding the Backpack press release and the establishment of a related website by Backpack that misrepresents the situation. Here’s what FTX wants the public and its former customers to know:
1. No Knowledge or Involvement: FTX had no knowledge of Backpack’s press release and did not participate in its creation or dissemination.
2. Ownership of FTX EU: FTX Europe AG, an FTX subsidiary, currently holds 100% of the shares of FTX EU. There have been talks of transferring these shares to former insiders of FTX, but this process has not yet taken place.
3. Bankruptcy Court Approval: The U.S. Bankruptcy Court in Delaware did not sanction any acquisition of FTX EU by Backpack. Instead, there is an ongoing agreement to sell FTX EU to certain former insiders, which Backpack was not privy to beforehand.
4. Responsibility for Customer Funds: FTX has made it clear that it is not responsible for repayment of funds owed by FTX EU to its previous customers. FTX EU will solely handle any refunds owed to its customers, and such determinations will not involve FTX or the Bankruptcy Court.
5. Involvement with Fund Recovery: Backpack is not involved in any court-approved processes to reimburse FTX customers, and it has not been authorized to make any distributions related to these funds.

Backdrop of the Clarification

The context of this clarification is significant. The ongoing legal and financial challenges faced by FTX since its bankruptcy filing highlight the sensitivities surrounding communications and claims about ownership, funds, and customer repayment. After declaring bankruptcy, FTX’s restructuring plans have been focused on restoring order and transparency in the distribution of remaining assets to creditors and claimants involved.

FTX's official statements noted that any communications made by Backpack regarding asset recovery for former customers are not endorsed or validated by FTX. The company emphasizes the importance of accurate information during this critical reorganization period. FTX has formally disclaimed responsibility for any inaccurate or incomplete information that Backpack may have circulated in their press release and other channels.

As FTX works through its bankruptcy proceedings, the company’s Chapter 11 plan, which was activated on January 3, 2025, will oversee the distribution of lingering claims over the coming 60 days. Current updates and details can be accessed through filings available at the official Bankruptcy Court's website.

Conclusion

This situation underscores the complexities of navigating financial communications amidst bankruptcy proceedings. FTX aims to alleviate confusion while solidifying its commitment to handling its restructuring in a disciplined and transparent manner. Customers and stakeholders are encouraged to rely solely on official FTX communications for guidance as the company continues to work towards stabilizing its financial obligations and restoring stakeholder confidence.