Cryptopia announced that customers who have signed up to the platform will now be asked to check their balances.
New Zealand crypto exchange Cryptopia has announced the third phase of its payback plan, after a 2019 hack in which customers lost more than $15 million.
In the third phase, account holders whose identities have been previously verified can log into a claims portal, to confirm that their balances are correct. Subsequently, in stage 4, clients will receive their outstanding asset balances.
The Cryptopia Hack 2019
Cryptopia filed for bankruptcy and went into liquidation in May 2019 after a hack in January 2019, in which 15% of customer funds were stolen.
Since 2020, Liquidator Grant Thornton has asked account holders to register and identify themselves. This is because Cryptopia stored client funds in a pooled wallet, instead of individual wallets.
The exchange executed transactions on an internal ledger and recorded them in a database. Consequently, the trustee had to reconcile both to find out the customers’ balances before the hack.
Grant Thornton said it would take some time to get the invitations out to customers. The liquidator offered customers the option to contact Cryptopia’s customer support portal for inquiries.
FTX Clients Begin the Long Journey to Wholeness
Even as Cryptopia clients can begin to breathe a little easier after a liquidation process that has taken almost two years, clients of a certain Bahamian exchange are only beginning their journey to wholeness.
On November 10, 2022, FTX CEO Sam Bankman-Fried (SBF) announced that his crumbling cryptocurrency business was looking to raise around $8 billion in liquidity to help pay customers.
The number surprised some, as the number of cryptocurrency companies with substantial assets has dropped substantially after the collapse of the Terra stablecoin in May 2022.
On November 11, 2022, FTX filed for Chapter 11 bankruptcy, after failing to raise the required capital. This means that the courts will decide how clients and other interested parties will be paid.
SBF explained the situation via Twitter, as follows:
“1) Hi all: Today, I filed FTX, FTX US, and Alameda for voluntary Chapter 11 proceedings in the US.”
“2) I’m really sorry, again, that we ended up here. Hopefully, things can find a way to recover. Hopefully, this can bring some amount of transparency, trust, and governance to them. Ultimately hopefully it can be better for customers.”
FTX has 120 days to submit a reorganization plan for creditor review. Ultimately, the Delaware Court of Chancery must approve the plan. A bankruptcy filing also allows FTX to continue to operate.
In the short term, FTX announced that holders of specific tokens on the Tron Blockchain would be able to withdraw their assets. Speaking on Bloomberg TV, crypto attorney Timothy Spangler said it could take months, if not years, for the rest of FTX’s clients to recover.
By Audy Castaneda
