The FTX bankruptcy estate has raised alarms regarding creditor payouts in countries with unclear or strict cryptocurrency regulations. Recently, it filed a motion with the US Bankruptcy Court in Delaware to authorize the FTX Recovery Trust to halt distributions to creditors in 49 jurisdictions deemed potentially restricted. These areas have ambiguous crypto laws, which could lead to legal complications. The estate warned that distributing funds in violation of these laws could result in fines, penalties, or even criminal charges for involved parties. While the estate is not entirely blocking payouts to these countries, it is pausing distributions until compliance with local laws is confirmed. Notably, China represents 82% of the affected claims, despite its strict stance on crypto transactions. The FTX estate has established procedures to clarify the distribution process for stakeholders, acknowledging the legal uncertainties surrounding token distributions in bankruptcy. Some community members have criticized this cautious approach, while others see it as a prudent measure given the complexities involved. Read more AI-generated news on: https://app.chaingpt.org/news