Planned demands for information on the crypto exchange’s dealings would duplicate the work of the independent examiner who has yet to be appointed, the U.S. Trustee said

Proposals to subpoena FTX founder Sam Bankman-Fried, his immediate family and senior staff of the bankrupt crypto exchange have been opposed by the U.S. Trustee, a branch of the Department of Justice dealing with bankruptcy.

The plans, set to be discussed at a Wednesday hearing, would duplicate any independent examination of the exchange’s downfall, U.S. Trustee Andrew Vara said in a legal filing made Thursday. An independent examiner has yet to be appointed. The examiner issue will be discussed at a Monday hearing, with new FTX Chief Executive Officer John Ray set to give testimony.

“If the Court directs the appointment of an examiner, then his or her charge could be to investigate the same web of entities and transactions” as the proposed requests for information, Vara said. “The bankruptcy court has an obligation to prevent unnecessary expenditures in the administration of an estate.”

FTX filed for bankruptcy on Nov. 11, and Bankman-Fried resigned as CEO the same day to be replaced by restructuring expert Ray. In a Jan. 25 filing, FTX’s new management said Bankman-Fried, his brother Gabriel and his parents could potentially have valuable information about what happened to funds allegedly misappropriated from the company before its collapse.

Potentially key witnesses are not cooperating, FTX said, adding that co-founder Gary Wang and Caroline Ellison, head of FTX’s trading arm Alameda Research, expressly declined to provide requested information.

The U.S. Trustee also opposed a bid to seek information from those who might know about a more than $300 million hack and subsequent laundering of digital assets that took place on Nov. 11-12, whose alleged identities have been redacted from court documents.

A bipartisan group of Senators has been among those calling for an independent examiner into the FTX affair, rather than letting the company do its own probe. In the parallel case of bankrupt crypto lender Celsius, examiner Shoba Pillay produced her report last Tuesday, and in a Feb. 1 filing, Vara argued appointing an examiner for FTX was effectively required by law given the sums at stake.

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The deal could be one of the biggest ever in the crypto industry.

The founder of crypto exchange Huobi Global, Leon Li, is in talks to sell a majority stake in the company in a transaction that would value the firm at $3 billion or more, Bloomberg reported on Friday.

Li is looking to sell almost 60% of the firm, and has held preliminary talks with Tron founder Justin Sun and FTX, the crypto exchange founded by Sam Bankman-Fried, the report said, citing people familiar with the matter.
In a tweet, Sun denied any involvement.

Seychelles-based Huobi is one of the largest crypto exchanges, with a daily trade volume of over $1 billion, according to CoinGecko.

If concluded, the deal would be one of the biggest ever in the crypto industry. The downturn in the crypto market has forced many of the biggest firms to cut costs and jobs, however this could be the first instance of a majority stake sale by one of the bigger crypto firms.

Huobi’s existing investors, which includes ZhenFund and Sequoia China, were informed about Li’s decision during a shareholder meeting last month, the report added.

A deal could be completed as soon as the end of this month, the report noted. Li is seeking an overall valuation of $2 billion-$3 billion, which means that the stake sale could fetch upwards of $1 billion, the report said.

FTX has made a slew of offers to acquire crypto companies during the recent market downturn, snapping up Japanese exchange Liquid in April before agreeing to acquire Canadian trading platform Bitvo two months later. It also has a deal in place to purchase lending platform BlockFi for up to $240 million.

FTX has also been eyeing up purchases of Celsius Network and Voyager Digital, both of which filed for bankruptcy in July.

After the Bloomberg report was published, Huobi’s native token HT jumped nearly 25% to $5.43, hitting a high of $5.80 at one point.

Tron founder and CEO Justin Sun denied that acquisition talks had taken place.

Huobi Global, Tron and FTX did not immediately respond to CoinDesk’s request for comment.

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