Crypto bankruptcies have caused huge losses for investors, but also millions in revenue for law firms involved in the most high-profile cases. Since August, law firms working on the seven Chapter 11 crypto bankruptcies of 2022 have collectively received approximately $692 million in fees.
Nearly €450 earned by 4 law firms
The law firms that profited the most from these bankruptcies were Sullivan & Cromwell, Kirkland & Ellis, White & Case, and Cleary Gottlieb. Together, these four firms earned approximately $446 million, which represents 64% of all fees charged and received in these bankruptcy cases.
Sullivan & Cromwell emerged as the most profitable law firm, with revenues of around €198 million. The firm represents the bankrupt cryptocurrency exchange FTX and was charging over €9.2 million per month until February, after which it reduced its fees to around €6.4 million per month.
Kirkland & Ellis had the second-highest fees, totaling approximately $130 million for its work on the Voyager, BlockFi and Celsius bankruptcies, among others. The majority of this revenue, more than $70 million, came from its work for Celsius.
White & Case, which was involved in the Genesis and Celsius bankruptcies, earned approximately €69 million. This firm worked with Celsius’s creditors and was involved in the investigation of Alex Mashinsky, the former CEO of Celsius. In the Genesis case, the firm represented the committee of unsecured creditors.
Cleary Gottlieb, which represents Genesis in its bankruptcy case, earned nearly $67 million. Since the case began, the firm has charged about $2.3 million a month.
Bankruptcy cases are still pending
There are still several ongoing bankruptcy cases, including that of the infamous FTX and the Terraform Labs case, which arose after the collapse of the algorithmic stablecoin TerraUSD.
FTX’s confirmation hearing is scheduled for October, ending this protracted bankruptcy case. Terraform Labs’ reorganization hearing is scheduled for September 19.
Genesis recently completed its restructuring plan and paid approximately €3.7 billion in damages to affected parties on August 2.
Source: https://newsbit.nl/advocaten-verdienen-miljoenen-aan-cryptofaillissementen-terwijl-investeerders-miljoenen-verliezen/
