Several mainstream media outlets are pushing to publicize the personal details of FTX’s non-US customers. Bloomberg, The Financial Times, The New York Times, and its parent firm, the Dow Jones & Company, have jointly objected to the redaction of customers’ names in a recent filing to a Delaware Bankruptcy Court. They argued that the press and public have “a presumptive right of access to bankruptcy filings.”
FTX’s debtors have argued for the names of creditors to be redacted in bankruptcy filings, but the media outlets believe that FTX and its customers have failed to justify such secrecy. In a December 28 filing, the Ad Hoc Committee of Non-US Customers of FTX.com claimed that publicly revealing the names and private information of non-US customers leaves them vulnerable to identity theft, targeted attacks, and other injury.
Crypto lending platform Celsius had also tried to ensure that its customers’ names remained redacted during its bankruptcy proceedings but failed to convince the judge. This resulted in the personal details of thousands of customers being disclosed on October 5, 2022.
The Importance of Public Access
The media outlets argued that “public access is of the utmost importance here” as the magnitude of the FTX collapse has “ignited intense public interest in the US legal system’s approach to the burgeoning and largely unregulated cryptocurrency market.” They added that the sealing of the names of FTX’s creditors to date has significantly impeded reporting on, and analysis of, these proceedings, leaving the public—and creditors—largely in the dark as to the United States’ enforcement of its bankruptcy laws in the crypto context.
In response to the Committee’s December 28 filing, Judge John Dorsey allowed the names and addresses of the customers to be redacted for a further three months on January 11. He noted that he “remained reluctant at this point” to disclose the confidential information, which may put creditors “at risk.”
Hearing Set for April 12
A hearing on the matter is set to occur on April 12 at 1:00 pm Eastern Time. The outcome of this hearing could have significant implications for the privacy and security of non-US customers of cryptocurrency exchanges. If the media outlets are successful, it could set a precedent for the public disclosure of customers’ names in future bankruptcy proceedings.
The demand for the names of non-US FTX users by mainstream media outlets has sparked a contentious legal battle. While the media outlets argue for public access to bankruptcy filings, FTX and its customers claim that disclosing such information could leave them vulnerable to harm. It remains to be seen what the outcome of the hearing will be, but it is clear that this case will have significant implications for the cryptocurrency market and the privacy of its users.