FTX and Alameda were ordered by a US judge to pay $12.7 billion to creditors

FTX and its affiliate Alameda Research will pay $12.7 billion to creditors after being approved by a consent order from a New York judge, ending a lawsuit brought by the Commodity Futures Trading Commission (CFTC). The order prohibits FTX and Alameda from trading in digital assets and acting as market intermediaries, but does not include any civil fines.

Defunct cryptocurrency exchange FTX and its affiliate Alameda Research will pay $12.7 billion to creditors after a New York judge formally approved a consent order on Wednesday, ending a 20-month long lawsuit. U.S. District Judge Peter Castel granted the approval on Aug. 7, and the order does not involve a civil monetary penalty, according to documents filed.

The order does not include civil fines, but prohibits FTX and its sister company Alameda, once a heavyweight crypto market manufacturer, from trading digital assets and acting as intermediaries in the market.

The bankrupt FTX filed for bankruptcy in late 2022, destroying billions of dollars of investor wealth. Subsequently, the CFTC filed a lawsuit against FTX and Alameda, alleging that both committed fraud and misrepresentation by promoting FTX as a digital commodity asset platform.

Sam Bankman-Fried, who founded the two companies, was sentenced in March to 25 years in prison and ordered to forfeit $11 billion. He was earlier convicted of seven counts of fraud, conspiracy and money laundering.