Stephen D Palley, a partner in the Washington DC office of Anderson Kill, shed light on the Cryptopia — US Bankruptcy court filing, on his own Twitter handle. Cryptopia, a now-defunct New Zealand cryptocurrency market, has always been in the limelight of this cryptocurrency space ever because it had been hacked in mid-January 2019.
The market which lost tens of thousands of dollars worth of cryptocurrencies because of a security breach declared liquidation earlier this month, naming two executives in Grant Thornton because it recorded liquidators. According to the recent statements, the trade filed for U.S bankruptcy protection, and Grant Thornton was exploring the number of funds which were assumed to be paid back to their clients.
but this investigation procedure came to a sudden stop after Phoenix NAP, LLC, an Arizona-based IT service supplier, terminated its support arrangement and obstructed the market’s access to the information saved. More so, the support supplier required a payment of about $2 million. Nonetheless, the court records released on May 27, 2019, disclosed that the New York bankruptcy court had taught that the exchange to cover up $274,408. 92 into the Arizona firm for the support for May and June. This was followed closely with the Grant Thornton releasing a formal announcement that regaining the information itself could take weeks.
Before today, Stephen Palley, a renowned attorney in the cryptocurrency area, pointed out that the market’s highest earnings was from clients from the U.S, followed by Ukraine, Germany, and Russia. The attorney said on Twitter,
Most earnings from broke New Zealand crypto market came out of U.S. accountholders, based on Chapter 15 submitting in SDNY bankruptcy court on Friday. pic.twitter.com/61V2KvyhLY
— Palley (@stephendpalley) May 27, 2019
The attorney further said,
A 15 submitting is a way to get US bankruptcy court to give effect to some foreign bk/liquidation proceeding. This gives the firm the capability to request the BK Court to dictate the Organization’s AZ established database supplier to Maintain the information”