FTX's bankruptcy estate legal team has formally objected to a $1.53 billion claim filed by the failed hedge fund Three Arrows Capital (3AC). This objection was submitted on June 22, 2025, within the Delaware bankruptcy court where FTX's liquidation is being managed. The disputed claim by 3AC has expanded from an initial $120 million to over $1.5 billion, which FTX contests as exaggerated and unfounded.
The core of the dispute involves the valuation of digital assets 3AC allegedly held on FTX's platform at the time of its bankruptcy in November 2022. FTX asserts that these assets were worth approximately $284 million, not the $1.6 billion claimed by 3AC, highlighting that much of that amount included over $733 million in margin debt. FTX states that significant losses occurred within days, including $222 million lost in market downturns and $60 million withdrawn by 3AC itself. FTX maintains it acted in line with contracts to limit losses after 3AC failed to meet margin calls.
The objection filing emphasizes that approval of 3AC's inflated claim would increase the total creditor claim pool by about 20%, severely reducing recoveries for other creditors. This situation draws parallels to past crypto insolvencies such as Mt. Gox and Celsius, where late-stage claims similarly impacted creditor distributions.
FTX's CFO Louis D’Origny warned of significantly lower recoveries for customer creditors if 3AC's massive claim is accepted. Moreover, the dispute holds potential precedential value, possibly shaping future regulatory and legal approaches to crypto bankruptcy processes.
The Delaware court had previously sided with 3AC in some aspects, but FTX is seeking dismissal or substantial reduction of the claim. The next hearing is scheduled for August 12, 2025. Analysts also note potential volatility in cryptocurrency tokens connected to both entities, including Ethereum (ETH) and Bitcoin (BTC), as the legal outcome unfolds.