A recent court document revealed that major cryptocurrency exchange FTX had spent substantial prepaid funds for endorsement and partnership agreements before its collapse in November 2022.
Coachella, famous for hosting acts like Madonna, Prince, and Daft Punk, reportedly received $1.98 million in prepayments.
FTX’s Payment to Coachella Remains Uncertain
In a recent court filing, several major celebrities, brands, and sporting teams were listed as having received prepayments for services from the now-defunct crypto exchange.
The prepaid expenses listed included executory contracts, leases, insurance, taxes, and rent. However, the filing suggests that the debtors are currently investigating which funds can be recovered by bankruptcy proceedings.
“For the avoidance of doubt, the Debtors hereby reserve all of their rights, including to revise, amend, supplement and/or adjust the Schedules and Statements.”
The purpose of the $1.98 million payment to Coachella remains undocumented. However, both entities have publicly worked together before.
In February 2022, Coachella partnered with FTX US to introduce a non-fungible token (NFT) series. The NFTs granted 30 people “tickets for life” and access to upcoming festival virtual experiences as part of the package.
FTX Debtors Continue To Scrutinize Financial Records
The Debtors are currently conducting ongoing investigations and reconciliations. Consequently, these efforts may lead to revisions, amendments, supplements, and adjustments to the Schedules and Statements.
It makes the task more complicated that the individuals who formerly managed FTX financial records are reportedly unreachable.
The filing explains that this could be because of legal obligations in their local jurisdiction or their unwillingness to collaborate with the current FTX Debtors.
The document also emphasized that anyone trying to assess FTX’s current or future financial status should not place reliance on the provided payment schedules.
The largest payment listed was to Kevin O’Leary for $2.35 million, followed by MLB Advanced Media for $2.14 million.
This news emerges as the FTX debtors have escalated their efforts to recover funds in recent times.
On July 14, reports revealed that FTX was suing its European arm, FTX Europe, to recover $323 million, claiming misuse of funds by investors.
The debtors claim that Sam Bankman-Fried and his associates used the money for themselves instead of growing their presence in Europe.
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Source: https://beincrypto.com/ftx-coachella-payment-court-filing/