FTX has asked a U.S. bankruptcy court to approve a new plan for dealing with customer claims from 49 countries where crypto is banned or restricted. The company said in its filing that paying users in those places could break local laws and create legal problems for the estate.
According to the motion, these regions make up around five percent of all filed claims, but a large share of the money involved, over 82% is tied to users in mainland China.
As first reported by Law360, FTX plans to send each affected user a formal notice explaining the restriction and giving them 45 days to respond. Those who do not reply in time may lose the right to receive funds.
The report states that FTX will work with outside legal counsel to review each case. If legal advice confirms that a payout does not break local law, the claim will be processed. If the guidance is negative or unclear, the claim may be denied or placed on hold.
The list of countries includes China, Russia, Nigeria, Saudi Arabia, Egypt, and several smaller nations where crypto use is restricted or banned. In many cases, laws in those countries either block crypto trading outright or require licences that do not exist yet.
If the plan is approved, FTX will handle those claims differently from the rest. The company said this is the only way to protect the estate from new risks while staying within local and international laws.
A hearing on the request is expected later this month. Legal experts say the ruling could set a standard for how cross-border crypto claims are handled in future bankruptcies.
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