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Will FTX customers’ names be exposed? Media outlets demand transparency

FTX

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TL;DR

  • Several prominent media outlets, including Bloomberg, Dow Jones & Company, The New York Times, and the Financial Times, have opposed the decision to seal the names of FTX customers from the public.
  • Judge Dorsey, however, decided to keep the names sealed, emphasizing the need to protect customers from potential scams.
  • Dubai-based crypto lawyer Irina Heaver argued that the media organizations’ appeal overlooks the unique risks faced by individuals if their identities are exposed. 

Several prominent media outlets, including Bloomberg, Dow Jones & Company, The New York Times, and the Financial Times, have opposed the decision to seal the names of FTX customers from the public. United States bankruptcy Judge John Dorsey made the decision on June 9, citing customer safety as the primary concern in the case.

In response, legal representatives for the media organizations have filed a court appeal, arguing that FTX should not be granted a broad exception to bankruptcy disclosure requirements solely because cryptocurrency was involved. They maintained that bankrupt companies typically disclose the names of their creditors and the amounts owed.

https://twitter.com/AFTXcreditor/status/1672142097330184192

Judge Dorsey, however, decided to keep the names sealed, emphasizing the need to protect customers from potential scams. This decision aligns with an exception in U.S. bankruptcy law that addresses the risk of harm through disclosure.

This is not the first time the media outlets have objected to the sealing of FTX customer names. They had previously filed an objection on May 3, contending that revealing the names would not subject creditors to undue risk and that the list does not qualify as confidential commercial information.

FTX customer’s confidentiality protected

Dubai-based crypto lawyer Irina Heaver commended Judge Dorsey’s ruling, stating her support for FTX’s ability to maintain customer name confidentiality. Heaver argued that the media organizations’ appeal overlooks the unique risks faced by individuals if their identities are exposed. She pointed to the “Celsius case” as an example, which resulted in a surge of phishing attacks in July 2022.

In the Celsius case, depositors received a warning email after the company disclosed that certain customer data had been compromised due to an internal employee leaking a list of emails to a third-party actor. Heaver emphasized the potential for widespread financial and personal damage, given FTX’s user base of 9 million individuals.

The opposing viewpoints between the media outlets and the crypto lawyer highlight the tension surrounding the disclosure of FTX customer names. While the media organizations advocate for transparency and adherence to typical bankruptcy disclosure requirements, the lawyer stresses the potential harm and the need to safeguard customers from potential threats that may arise from such disclosure. The outcome of the court appeal will determine whether the FTX customer names remain sealed or are made public

Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.

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Lacton Muriuki

Lacton is an experienced journalist specializing in blockchain-based technologies, including NFTs and cryptocurrency. He dabbles in daily crypto news rich with well-researched stats. He adds aesthetic appeal, adding a human face to technology.

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