FTX logo displayed on a smartphone screen and in the background. Source: Rafael Henrique - stock.adobe.com

Key Takeaways:

Court Rejection: FTX denied court approval for Backpack’s acquisition of FTX EU and its claims of managing creditor repayments.
Unauthorized Sale: FTX revealed that Backpack’s acquisition occurred without notifying the bankruptcy court or FTX, contradicting prior agreements.
FTX Repayments Ongoing: FTX emphasized its sole authority over customer repayments, with creditor distributions already underway.

FTX has denied court approval for the reported acquisition of its European division, FTX EU, by crypto exchange Backpack.

Backpack had claimed on January 7 that it had acquired FTX EU as part of FTX’s bankruptcy process and would prioritize creditor repayments for EU-based customers starting in February.

🚨JUST IN: FTX SAYS BANKRUPTCY COURT HAS NOT APPROVED BACKPACK EXCHANGE’S PURCHASE OF FTX EU
— BSCN Headlines (@BSCNheadlines) January 9, 2025

However, FTX clarified on January 8 that the U.S. Bankruptcy Court for the District of Delaware had not approved the sale and that Backpack’s announcements were made without FTX’s knowledge or involvement.

FTX disclosed that it had previously agreed to sell FTX EU to former FTX Europe executives under a court-approved settlement, but those executives allegedly transferred the entity to Backpack without notifying FTX or the court.

FTX emphasized that Backpack lacks authority to process repayments or manage customer funds.

Despite this, Backpack claimed the acquisition would strengthen its European presence by utilizing FTX EU’s MiFID II license.

The firm, founded in 2022, lost significant funds during FTX’s collapse but continues operating on limited resources.

Meanwhile, FTX’s reorganization plan initiated creditor repayments on January 3.

The FTX Debtors today provided clarification on certain statements by Backpack relating to Backpack’s purported acquisition of FTX EU. Read more here: https://t.co/WVwfNXBKRj
— FTX (@FTX_Official) January 8, 2025

Customers with claims under $50,000 are part of the initial distribution, expected within 60 days.

FTX maintains full control over the repayment process.