Attestor Sues Seller Amid Bitcoin Rally After Profiting 200% on FTX Claims

London-based hedge fund Attestor Capital has filed a lawsuit against Lemma Technologies, a seller of FTX claims, after making a 200% profit on the purchased FTX claims stash.

Attestor, known for its focus on distressed assets and private equity, has been a major player in buying FTX's bankruptcy assets, alongside other firms like Silver Point Capital and Diameter Capital Partners. As of February, Attestor was the largest buyer of FTX claims, having purchased at least $400 million worth, according to Claims Market data.

The lawsuit stems from an agreement in June 2023, where Lemma agreed to sell FTX claims to Attestor for $58 million. However, Lemma later decided to back out of the deal, citing the soaring prices of cryptocurrencies, particularly Bitcoin, which had surged nearly 130% over the past year.

Attestor alleges that Lemma's decision to keep the claim for itself was a case of "seller's remorse." The lawsuit, filed in New York, claims that Lemma has not provided any public explanation for its actions and has not filed a defense against Attestor's suit.

The situation adds another layer of complexity to the ongoing fallout from the collapse of the FTX exchange. Meanwhile, Lemma's principal investor, Junho Bang, is facing legal issues in South Korea, where he is accused of stealing digital assets from the collapsed crypto lending firm Haru Invest.

Lemma's troubles highlight the risks and challenges involved in the cryptocurrency market, especially in the context of bankruptcies and legal disputes. The outcome of Attestor's lawsuit could have implications for how similar disputes are resolved in the future.