Last updated on October 14th, 2024 at 10:43 am
Californian investor Nikolas Gierczyk has filed a lawsuit against hedge fund Olympus Peak, accusing the firm of failing to honour an agreement related to an FTX bankruptcy claim.
According to a Bloomberg report, Gierczyk claims the hedge fund owes him over $1 million in excess recovery, citing expectations of a 129% to 146% payout for creditors under the FTX bankruptcy plan.
Gierczyk asserts that Olympus Peak, which purchased his claim at a significant discount, assured him that he would receive any excess distributions. However, in a complaint filed in federal court in Manhattan on October 10, Gierczyk’s legal team stated,
“Olympus Peak made it clear that they would not be fulfilling their end of the bargain.”
The hedge fund, located in Greenwich, Connecticut, has not yet responded to the allegations.
This report comes on the heels of a Delaware bankruptcy judge’s approval of FTX’s reorganization plan on October 7, nearly two years after the crypto exchange’s collapse in November 2022. In a statement, the crypto exchange company reported that it has accumulated property distributions valued between $14.7 billion and $16.5 billion. This amount exceeds FTX’s earlier estimate of approximately $11.2 billion owed to creditors.
“Looking ahead, we are prepared to return 100% of bankruptcy claim amounts along with interest for non-governmental creditors through what will be the largest and most complex bankruptcy estate asset distribution in history,”
stated John Ray, who assumed the role of FTX CEO following the company’s bankruptcy filing.
The case comes as a new report highlights a growing interest in cryptocurrency investments among hedge funds. A new report reveals that nearly half of hedge funds focused on traditional asset classes have ventured into cryptocurrencies, with 47% now investing in this sector, up from 29% in 2023 and 37% in 2022. Among these funds, 67% plan to sustain their current cryptocurrency investments, while others aim to increase their exposure by the end of 2024.
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