The motion was initially filed to implement “restricted procedures” in certain foreign jurisdictions. It aimed to advance the execution of FTX’s restructuring plan.
Following objections raised by the court during a hearing on October 23, the Trust withdrew the motion unconditionally on November 3. Experts see this as a phased victory for creditors seeking to protect their rights and interests.
Understanding the Withdrawal and Its Impact
The withdrawn motion would have allowed the Trust to take specific legal steps in foreign countries without full disclosure to all parties. While such procedures can sometimes streamline recovery in complex cross-border bankruptcies, the court’s objections highlighted concerns about fairness and transparency for stakeholders. By withdrawing the motion, the Trust now ensures that any future actions must follow standard notification processes, safeguarding the interests of affected creditors.
FTX RECOVERY TRUST WITHDRAWS BID TO LIMIT PAYOUTS IN RESTRICTED COUNTRIES, INCLUDING CHINA
FTX Recovery Trust has pulled back its attempt to restrict payouts in certain countries, such as China, which had $380M in claims tied to the liquidation process.
This move could delay… pic.twitter.com/4qSHHFvpf9
— Crypto Town Hall (@Crypto_TownHall) November 4, 2025
On November 3, FTX officially pulled back its previous motion that sought to limit repayments in 49 “restricted jurisdictions,” such as China, Russia, Ukraine, Saudi Arabia, and Pakistan. Had the motion been approved, claims from these countries—totaling roughly $800 million, with Chinese claims making up 82%—could have been forfeited. Creditors view the withdrawal as a partial win. The FTX Recovery Trust retains the option to file the motion again at a later date.
According to recent filings, the FTX Recovery Trust continues to oversee the liquidation of remaining assets and distribution to creditors. Any procedural missteps in foreign jurisdictions could have delayed or reduced recovery for investors, making the court’s decision a meaningful step toward a more structured process.
A Broader Trend in Crypto Bankruptcy Proceedings
FTX is part of a growing trend where large crypto firms face complex bankruptcy proceedings spanning multiple countries. For example, the 2022 collapse of Celsius Network also involved cross-border legal challenges as the platform sought to repay customers. This is while navigating local laws.
Luna collapsed May 2022
Celsius Bankruptcy July 2022
FTX collapse Nov 2022Be careful with anything involving lending of funds to centralized parties for yield. Insolvencies take a long time to surface. https://t.co/blfKp8JA4Z
— Dev 🧪 (@valardragon) November 4, 2025
Such cases underscore the importance of meticulous legal planning. Also, clear communication and adherence to court procedures to safeguard investor interests. According to a Chainalysis report, over $8 billion in cryptocurrency was lost to bankruptcies and scams in 2023. It highlights the significant stakes involved for creditors and investors alike.
Disclaimer
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