The New York-based Metropolitan Museum of Art, also known as the Met, has decided to return more than half a million dollars in donations it received from the now-defunct crypto exchange FTX. According to a recent filing with the United States Bankruptcy Court in Delaware, the museum aims to refund $550,000 to FTX debtors. The donations, which were given in 2022 before FTX’s collapse in November, included $300,000 in March and $250,000 in May. Both installments were facilitated by the FTX.US operator, West Realm Shires Services.
The debtors involved in this case have argued that the terms of the proposed stipulation “fall well within the range of reasonableness” and that the court should approve the stipulation. They have emphasized that returning the funds provides their estates and stakeholders with a recovery of 100% of the donations without the need for litigation and the significant costs associated with it. In return, both parties would receive mutual releases of any and all claims related to the donations.
Despite this seemingly reasonable proposition, a subtle tension lies in the challenge of recuperating the donated funds. FTX and its former CEO, Sam Bankman-Fried, made donations to politicians, celebrities, and reportedly various charities. In October 2022, the FTX Foundation, set up by Bankman-Fried, reported that it had given away $140 million. Following FTX’s collapse, the US Justice Department alleged that these donations were a result of criminal money laundering and that payments violated campaign finance rules.
With millions of dollars given away, the new leadership of FTX has been attempting to recover as much of the donated funds as possible since December last year. However, this effort has been met with limited success, as by March 2023, only 2.2%—or $1 million—of the money Bankman-Fried had donated to political candidates from the Democratic Party had been returned. Among this sum, the Democratic National Committee (DNC) stated it would return $850,000 to FTX.
In conclusion, while the Met’s decision to return the donations they received from FTX seems like a positive gesture, it also highlights the complexity of recovering funds channeled through various avenues and the potential for misuse in the world of cryptocurrency donations. The immense amount of donations made by FTX and its former CEO to multiple entities raises concerns about the transparency and accountability of such transactions, and whether adequate regulations are in place to monitor these activities.
Source: Cryptonews
