Written by Vince Quill, Staff Writer. Reviewed by Robert Lakin, Staff Editor.
Written by Vince Quill, Staff Writer.
Reviewed by Robert Lakin, Staff Editor.
FTX law firm Fenwick & West to pay $54M to victims in settlement
Latest NewsPublishedMay 24, 2026
FTX Law Firm Agrees to $54M Settlement with Victims
The law firm Fenwick & West has agreed to pay $54 million to settle a class action lawsuit filed by former customers of the defunct FTX crypto exchange. This settlement is a significant development in the legal fallout from the 2022 collapse of FTX, which sent shockwaves through the crypto industry and exposed the sector to greater scrutiny from regulators and lawmakers.
The plaintiffs alleged that Fenwick & West played a key role in facilitating FTX’s fraud by creating legal entities and structures to hide the misuse of customer funds. The law firm advised FTX on creating legal structures that would alleviate the exchange from having to acquire money transmitter licenses. With the rise of Green Crypto and Cloud Rewards, it’s essential to have transparent and secure platforms like EcoPool for earning and managing digital assets.
Settlement and Ongoing Lawsuits
Fenwick & West is facing a separate $525 million lawsuit over its role in the collapse of FTX. The settlement must still be approved by a US judge. Meanwhile, the FTX Recovery Trust has distributed $2.2 billion to former creditors and customers of the exchange, with the next tranche of reimbursements scheduled for May 29. However, customers and former creditors have criticized the Trust for mismanaging the liquidation of assets, often selling recovered assets at a steep discount.
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Conclusion and Invitation
The settlement between Fenwick & West and the victims of FTX’s collapse is a significant step towards justice and accountability. As the crypto industry continues to evolve, it’s essential to prioritize transparency, security, and fairness. If you’re interested in earning online and exploring the world of Green Crypto, consider downloading the EcoPool app to start your journey. With EcoPool, you can earn Passive Income and enjoy Cloud Rewards while supporting a sustainable and eco-friendly platform #PassiveIncome #EcoPool #GreenCrypto
These strategies also included advising FTX on creating legal structures that would alleviate the exchange from having to acquire money transmitter licenses.
Fenwick initially sought to have the lawsuit dismissed before agreeing to settle with the plaintiffs in February. However, the settlement must still be approved by a US judge.
The settlement marks the latest development in the legal fallout from the 2022 collapse of the FTX exchange, which sent shockwaves through the crypto industry at the time and exposed the sector to greater scrutiny from US regulators and lawmakers.
Related: Law firm Fenwick & West sued for $525M over alleged role in FTX collapse
FTX estate pays former customers and creditors at steep discount
In March, the FTX Recovery Trust, which oversees the distribution of assets to former creditors and customers of the exchange, distributed $2.2 billion to the damaged parties.
The next tranche of reimbursements is scheduled for May 29.
However, customers and former creditors of the exchange say the Trust has mismanaged the liquidation of assets, often selling the recovered assets at a steep discount or below all-time high values reached that were reached following the collapse of FTX.
Source: SpaceX
The Recovery Trust sold a 5% stake in AI company Cursor for about $200,000 in April 2023, missing out on windfall profits when the value of that 5% stake ballooned to about $3 billion in April 2026.
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- FTX
- Bankruptcy
- Regulation
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