FTX was found to be losing $53,000 per hour due to ‘bankruptcy fees’.

adminDecember 18, 2023

Crypto exchange FTX, which was out of business for three months ending October 31, was burning through about $53,000 per hour from bankruptcy lawyers and advisors, according to recent claims filings.

Bankruptcy lawyers filed claims for at least $118.1 million from Aug. 1 to Oct. 31, according to court filings from Dec. 5 to Dec. 16. Over 92 days, this amounts to $1.3 million per day, or $53,300 per hour.

The largest bill came from management consulting firm Alvarez and Marshall, which billed $35.8 million for services over three months.

*Alvarez and Marshall charged a total of $35.8 million in fees to FTX assets. Source: CourtListener*

In second place was global law firm Sullivan & Cromwell, which billed $31.8 million for its services. The hourly rate for Sullivan & Cromwell services averaged $1,230 per hour.

*Sullivan and Cromwell’s services cost FTX creditors $1,230 per hour. Source: CourtListener*

Global consulting firm AlixPartners billed $13.3 million for professional services related to the forensic investigation during the period. Quinn Emanuel Urquhart & Sullivan billed $10.4 million in the same period, while several other bills from smaller advisory firms added more than $26.8 million.

According to a December 17 post by an anonymous FTX creditor on

now @Gyeongju This estimates $145B in remaining professional fees for a total of $1.8B. The estate is currently charging $500 million a year, and bankruptcy is no short-term endeavor.
Here are the fees petitioned within a year to date (~$350 million paid): https://t.co/fZhMyTE3B1 pic.twitter.com/5p6at5ZbWy
— Mr Purple ️ (@MrPurple_DJ) December 17, 2023

Related: FTX debtors value their cryptocurrency claims based on market prices on the date of the petition.

Meanwhile, a previous report filed Dec. 5 by court-appointed fee examiner Katherine Stadler identified “significant concerns” in claims filed between May and May by large advisory firms, including Sullivan & Cromwell and Alvarez & Marshall. 1st and June 31st.

“Fee inspectors identified a variety of technical and procedural deficiencies related to apparently overburdened staffing, apparent excessive meeting attendance, fees related to off-hours travel time, and some time entries (including vague and lumped entries),” the report says. . Claim filed by Alvarez & Marshall.