In a decisive judicial decree, the now-defunct cryptocurrency exchange FTX and the trading enterprise Alameda Research have been ordered to disburse a staggering $12.7 billion to their creditors. This pronouncement, officially sanctioned by a New York judge, marks the culmination of a protracted 20-month legal skirmish instigated by the Commodity Futures Trading Commission (CFTC).

On August 7, United States District Judge Peter Castel ratified the consent order, as per court filings. Notably, this decree abstains from imposing any civil monetary penalties.

Read more: FTX Executive Ryan Salame Sentenced to Seven and a Half Years in Prison

While eschewing civil penalties, the order unequivocally proscribes FTX and its affiliated entity Alameda from engaging in the trading of digital assets and from operating as intermediaries within the market—a significant blow to the once-dominant crypto market makers.

The genesis of this legal saga can be traced back to late 2022, when FTX declared bankruptcy, obliterating billions of dollars in investor capital. In the wake of this financial cataclysm, the CFTC initiated litigation against FTX and Alameda, alleging that the entities perpetrated fraud and made deceptive representations, particularly by marketing FTX as a premier platform for digital commodity assets.

Sam Bankman-Fried, the architect behind both enterprises, faced a monumental legal downfall. In March, he received a 25-year prison sentence and was mandated to relinquish $11 billion. His conviction encompassed seven counts of fraud, conspiracy, and money laundering, encapsulating a dramatic fall from grace.