London-based Attestor Initiates Legal Action Against FTX Claims Seller, Lemma, Following 200% Profit on Acquired FTX Claims Portfolio Bitcoin

Amid the ongoing fallout from the collapse of the FTX exchange, Attestor Capital, a major FTX claim holder, has taken legal action against a claim seller. Attestor, a hedge fund headquartered in London specializing in distressed assets and private equity, has become a prominent buyer of FTX’s bankruptcy assets, alongside Silver Point Capital and Diameter Capital Partners.

According to data from the Claims Market, Attestor emerged as the largest buyer of FTX claims by February, having acquired claims worth at least $400 million. Following a substantial 200% profit from its FTX claims portfolio, Attestor filed a lawsuit against Lemma Technologies, the seller of one of its significant FTX accounts, as reported by Bloomberg on March 18.

Attestor alleges that Lemma had initially agreed to sell FTX claims to the company for $58 million in June 2023. However, Lemma later reneged on the deal amid the sharp rise in cryptocurrency prices, notably with Bitcoin surging by nearly 130% over the past year at the time.

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According to Attestor’s lawsuit, Panama-based Lemma opted to retain the claim for itself, which Attestor views as a clear case of “seller’s remorse.” Lemma has yet to publicly respond or provide its side of the case, and it has not filed a defense against Attestor’s lawsuit in New York.

Attestor’s lawyers stated in their filing that Lemma has refused to proceed with the transactions or honor the trade confirmations unless compelled by law to do so.

The sources reached out to both Attestor and Lemma for comments on the lawsuit but had not received a response at the time of reporting.

In addition to facing legal action in New York, Lemma’s principal investor, Junho Bang, has encountered legal troubles in South Korea. Bang is accused of embezzling digital assets from the collapsed crypto lending firm Haru Invest and was indicted by South Korean authorities following his arrest in January.

Haru Invest, which operated a cryptocurrency yield platform promising investors a 12% annual return on cryptocurrency deposits, suspended withdrawals abruptly in June 2023, citing issues with service partners. The CEO and two other executives of Haru Invest were arrested by South Korean prosecutors for allegedly stealing $830 million from thousands of customers.