What's his leverage to negotiate anything?
I don't think he has any leverage (he'll just walk away), but his creditors do. Hopefully some of them are willing to negotiate.
He wrecked the game and scammed a large portion of the player base by abusing his admin access. That calls for a significant to severe in-game penalty, up to and including expulsion. Attachment of his in-game assets is mild by comparison.
I believe there's enough reason to give Risto the benefit of the doubt, that his bad decision making was due to extreme stress induced by his personal situation, substance abuse, bad influences, genetic pre-disposition to mental health problems. Not everyone might agree, but IMO good people can lose it mentally, and do really stupid things, even act dishonestly, but later can regain their true 'character'. I'm nearly 50, and in my life I've seen good people fall down into bad behaviour many times, and some stay there, and some manage to get back up. Those who get back up sometimes need a helping hand, and some understanding. None of us are black or white, we're mostly grey.
IMO, once his assets are worth at least enough to pay a meaningful portion of the debt, he should be given one last opportunity to pay the debts, and then the assets can be sold (in an responsible orderly manner, which may take time). Whatever assets remain after that, he can still reclaim.
This is basically the same outcome as I am suggesting - once his in-game assets are high enough to repay his debts, he does so, and hopefully has enough left over to be a significant holder once all the debts are repaid. What I'm advocating is Risto and those he owes agree to this NOW, which would benefit everyone. Risto playing the Game as a regular player without admin privileges etc is unambiguously good IMO.