Lawyers Have Raked In At Least $700 Million From Major Crypto Implosions: New York Times Report
Lawyers, accountants, and consultants make up professionals who have raked in over $700 million in fees following the collapse of several digital asset firms last year.
A new report by the New York Times shows how the unfortunate crypto incidents have led to an unexpected “financial bonanza” for lawyers and other bankruptcy case-related professionals.
While the fees calculated from court filings and disclosures are described as huge by both observers and victims, these fees will increase further as some bankruptcy proceedings still have no end in sight.
FTX leads the pack with $326.8 million in legal fees so far after both the exchange and its sister company Alameda Research filed for bankruptcy in November 2022.
Bankrupt crypto lender Celsius follows FTX with $186.5 million while Voyager Digital and BlockFi recorded $88.2 million and $59.5 million respectively.
A look at the firms that have taken a large chunk of this money shows that Alvarez & Marsal have charged $126 million while Sullivan & Cromwell and Kirkland & Ellis have charged $111 million and $103 million respectively.
The report shows over 50 professional companies or partnerships directly drawing benefits in fees from these continued legal proceedings. Among the firms include bankers, blockchain transaction firms, and associated analysts.
A major reason cited for the huge legal fees is the uncertain nature of digital asset regulations leading to more complex processes and longer times in drafting legal documents.
In all of this, the victims have borne the brunt of the prolonged and expensive bankruptcy proceedings. Generally, bankruptcy proceedings are expensive because of the need to untangle complex court documents and trace lost assets.
Several victims have
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