Amid the chaos of FTX’s historic bankruptcy proceedings, a California-based customer, Nikolas Gierczyk, is taking legal action against hedge fund Olympus Peak.
Gierczyk claims the firm owes him a substantial additional recovery after selling his claims linked to the collapsed trading platform.
The controversy centers around a deal where Gierczyk sold his $1.59 million claim against FTX at a 42% discount, securing a $930,000 payout from Olympus Peak.
But with the recent approval of FTX’s reorganization plan, customers are now slated to receive between 129% and 146% of their claims. This development means Olympus Peak could potentially pocket between $2 million and $2.3 million for Gierczyk’s claims, reaping a profit of over $1 million from the transaction.
Also Read: FTX Drops Robinhood Claim For $14 Million
Gierczyk contends that Olympus Peak has failed to uphold an agreed-upon clause that guaranteed him rights to additional recovery, accusing the hedge fund of exploiting the situation for their gain. Olympus Peak has yet to respond publicly to these allegations.
On October 7, U.S. Bankruptcy Judge John Dorsey greenlit FTX’s reorganization strategy, a move FTX CEO and restructuring lead John J. Ray III hailed as a critical step towards paying back creditors.
He emphasized that non-governmental creditors could receive “100% of their bankruptcy claim amounts plus interest.” Ray dubbed the upcoming distribution as the “largest and most complex bankruptcy estate asset distribution in history.”
However, not all creditors are convinced. Some argue the plan fails to consider token value increases between November 2022 and 2024. One such critic, FTX creditor Sunil Kavuri, warned on September 28 that customers might see only 10–25% of their crypto assets returned.
This isn’t the first time FTX users have opted to sell their claims rather than wait for a lengthy bankruptcy resolution. Following the 2022 bankruptcy filings of FTX, Celsius Network, BlockFi, and Voyager Digital, hedge funds and investors jumped at the opportunity to buy up claims. Over 10,000 claims were listed for sale on platforms like Xclaim by that year’s end.
Meanwhile, the Claims Market by Cherokee Acquisition reports that over $600 million in FTX claims have already been sold, highlighting the enormous scale of this crypto crisis.
