Amid the tide of failing cryptocurrency firms, the legal industry is making a fortune.
Lawyers, consultants, and other professionals have collected hundreds of millions of dollars in fees from high-profile crypto bankruptcies, casting them as significant beneficiaries of the sector’s upheavals.
A recent report from The New York Times reveals that legal professionals have raked in around $700 million in fees related to the bankruptcy cases of five major cryptocurrency companies, including FTX, Voyager Digital, Celsius Network, Genesis Global, and BlockFi.
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It is worth noting that the figure is based on data gathered from July 2022 to July 2023 and is expected to soar as upcoming legal cases, such as Sam Bankman Fried’s trial in October, unravel.
According to the report, Sullivan & Cromwell, the law firm overseeing the bankruptcy of FTX, has already charged over $110 million in legal fees, along with $500,000 in additional expenses. The firm had a team of more than 150 people, including 30 partners charging over $2,000 per hour, solely focused on the FTX case as of January 2023.
Kirkland & Ellis, another law firm responsible for handling the bankruptcy cases for Celsius, Genesis, and Voyager, has billed $101 million plus $2.5 million in expenses. Similarly, turnaround management firm Alvarez & Marsal has charged over $125 million for its services related to Genesis, Celsius, and FTX.
As the cryptocurrency industry navigates regulatory scrutiny and financial instability, legal professionals continue to profit significantly. With major trials pending and the legal complexities looming over the crypto sector, this trend is expected to continue, bringing in even larger payouts for the legal sector.