FTX Customer Sues Hedge Fund Over Bankruptcy Claim Dispute

Nikolas Gierczyk, an FTX customer, has accused Olympus Peak of underpaying him after purchasing his FTX bankruptcy claim valued at $1.59 million. Gierczyk alleges that the hedge fund owes him significantly more in additional recovery.

According to an Oct. 11 report, Californian Nikolas Gierczyk is suing Olympus Peak for failing to honor his right to additional recovery. He asserts that the hedge fund owes him over $1 million from their agreement, as creditors are expected to gain between 129% to 146% from the FTX bankruptcy payout plan.

Gierczyk mentioned that he and Olympus Peak agreed on a purchase agreement when the hedge fund acquired the bankruptcy claim at a substantial 42% discount. He was assured of receiving any excess distribution from the bankruptcy proceedings.

“However, Olympus Peak made it clear that they would not be fulfilling their end of the bargain,” Gierczyk’s lawyers stated in a complaint filed in Manhattan federal court on Oct. 10.

Olympus Peak, a hedge fund based in Greenwich, Connecticut, has not responded to requests for comment. On Oct. 7, a Delaware bankruptcy judge approved FTX’s reorganization plan nearly two years after the crypto exchange’s collapse in November 2022.

The crypto exchange claims it has amassed between $14.7 billion and $16.5 billion in property distribution, surpassing its previous estimation of $11.2 billion owed to creditors.

“Looking ahead, we are poised to return 100% of bankruptcy claim amounts plus interest for non-governmental creditors through what will be the largest and most complex bankruptcy estate asset distribution in history,” said John Ray, who took over as FTX CEO after the company filed for bankruptcy.

According to the plan approved by Delaware bankruptcy Judge John Dorsey, 98% of FTX’s creditors will receive 118% of their claim as of November 2022, when the exchange filed for bankruptcy protection. This significant payout is attributed to the bullish nature of the crypto market over the past two years.

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