Report: FTX Paid Staggering 120 Million in Advisor Fees

Reports from bankruptcy court filings show that FTX's leading bankruptcy, financial, and legal advisors have billed the firm over $19.6 million in fees for work done in 2022.

Over $10 million was for the amount of work done in November last year, as the exchange's former CEO filed for bankruptcy protection. The firms will only receive 80% worth the value of their work, thanks to a court-ordered interim compensation plan.

Bankruptcy, Legal, and Financial Advisor Bill Accrue Massively in the Last 3 Months

Recent research from The Block shows that the FTX is still undergoing heavy financial burdens.The report shows that this burden emanates from the massive advisory, legal, and financial fees and costs.

From the report, between February 1 and April 30, the bankruptcy costs have accrued up to $121.8 million. FTX's legal representatives, Sullivan & Cromwell, billed the crypto exchange $37.6 million, making up 30.9% of the overall expenses and fees accrued.

FTX's restructuring consultants, Alvarez & Marsel, charged $37 million. Their expenses included meals worth $51,225, lodging worth $149,155, and other miscellaneous expenses totalling $1,995.

Landis Rath & Cobb, the other legal firm for FTX, billed $1.16 million for work done from Nov. 11 to Nov. 30, 2022.Meanwhile, Jefferies, the exchange's investment banking company, billed FTX the least amount, 0.6% of the overall expenses.

Also, the research information shows that the demands from Alvarez & Marsel were categorized as super senior' and are of a higher priority than its contemporaries. The filings also reveal that FTI Consulting worked almost 687 hours and billed $761,997.70 for the exchange's relaunch.

Is There A Way Forward For FTX?

While FTX struggles with the accumulated bankruptcy costs and expenses, stakeholders seek ways to revitalize the crypto exchange and provide a viable result for investors.Ikigai Asset Management's Chief Investment Officer, Travis Kling, expressed optimism about a relaunch of the exchange.

Also, he's not the only one who holds such hopes, as Loomdart, an anonymous user in the cryptocurrency community, is spearheading the FTX 2.0 alliance.

Loomdart believes that the regulatory challenges exchange giants like Binance and Coinbase face will enable the FTX exchange to regain its foothold.

Recall that FTX exchange filed for bankruptcy in November. 11, 2022, after losing over 99.5% of its total value to only 1 million. The lawsuit claims the cause of the loss was due to misconduct and lack of due diligence.

So far, the increasing costs of FTX's bankruptcy seem to be rallying a wave from the exchange's previous clients to reboot the platform and change the leadership.

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