The bankrupt cryptocurrency exchange, FTX, has been allowed to remove individual customers’ names permanently from court filings, according to a ruling by Judge John Dorsey in the Delaware-based bankruptcy court.
Corporate and institutional investors’ identities will also be kept confidential temporarily. This decision comes after mainstream media outlets sought access to FTX’s customer list, asserting a “presumptive right of access to bankruptcy filings.”
FTX had opposed revealing customer identities, citing potential security risks for individuals and potential depreciation in the sale value of the exchange. Judge Dorsey granted FTX the authority to “permanently redact” individual customer names from all filings to ensure their safety and protect them from potential scams.
While the Judge acknowledged the potential for scams and identity theft, he stated that companies and institutional investors are not as susceptible to these risks as individuals. Consequently, their names have been temporarily removed from the list.
FTX will need to request again in 90 days to retain the confidentiality of these corporate and institutional investors.
However, it was stressed that, although these entities don’t share the same vulnerabilities as individual customers, their identities could still have substantial value if FTX decides to sell the exchange or its customer list separately.
In a hearing on June 8, Kevin Cofsky, a member of the FTX restructuring team and partner at investment bank Parella Weinberg, stated that revealing customer names would harm restructuring efforts.
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