Bankrupt cryptocurrency exchange FTX has been given the green light to sell around 32 million shares in various digital asset trusts as part of its efforts to recover funds.
According to a Nov. 29 filing with a Delaware bankruptcy court, crypto exchange FTX received approval to sell approximately $873 million in trust assets, with the proceeds going to pay creditors affected by the exchange’s fall in 2022.
“The debtors are authorized, but not directed, to execute sales of the trust assets, in their reasonable commercial judgment, in accordance with the following sales procedures,” the document says.
Galaxy, a prominent cryptocurrency investment firm, has seen its role in assisting FTX with asset sales expanded, according to the latest court documents. Earlier this year, FTX had appointed Galaxy to manage its extensive digital asset holdings, a decision that now appears pivotal in the ongoing recovery process.
Assets earmarked for sale include FTX’s holdings in trusts issued by Grayscale Investments and custody services provider Bitwise. Grayscale’s holdings are currently valued at $807 million, while Bitwise’s assets amount to $66 million.
Notably, the total value of the assets was listed at $744 million in the court document, a figure based on the valuation as of October 25, 2023. The increase to $873 million reflects the recent rise in the value of cryptocurrencies. such as Bitcoin (BTC) and Ethereum (ETH).
The approval comes nearly a month after FTX debtors filed a request with Judge John Dorsey on Nov. 3, asking for permission to sell six cryptocurrency trusts, including Grayscale Bitcoin Trust (GBTC), Grayscale Ethereum Trust (ETHE), and Bitwise 10 Crypto Index. Fund (BITW).
FTX currently owns over 22 million units of Grayscale Bitcoin Trust (GBTC), now valued at $691 million, and 6.3 million shares of Grayscale Ethereum Trust (ETHE), currently worth approximately $106 million. Additionally, FTX is authorized to sell its holdings in Grayscale’s Ethereum Classic Trust (ETCG), Litecoin Trust (LTCN), and Digital Large Cap Trust (GDLC).
Since the collapse of Sam Bankman-Fried’s former empire in November 2022, FTX administrators, under the leadership of John J. Ray III, have been working diligently to recover assets.
Since the collapse of Sam Bankman-Fried’s crypto empire in November 2022, FTX administrators, led by John J. Ray III, have been working diligently to recover assets. To date, around $7 billion has been recovered, almost half of it in the form of cryptocurrencies ($3.4 billion).
In June, FTX debtors estimated the total amount of misappropriated client assets was $8.7 billion.
Meanwhile, Bankman-Fried was found guilty of seven fraud-related charges on November 2 and is awaiting sentencing, which is scheduled for March 28. He is currently being held at the Brooklyn Metropolitan Detention Center, where he recently reportedly traded four mackerel for a haircut. highlighting the stark contrast to his previous lavish lifestyle.
