Crypto exchange FTX gets nod to sell $873M of assets to repay creditors

Bankrupt cryptocurrency exchange FTX has been approved to sell approximately $873 million in trust assets, with the proceeds used to repay creditors affected by the exchange’s collapse in 2022. according to Documents filed Nov. 29 in Delaware Bankruptcy Court.

The $873 million in assets will come from FTX’s stakes in various trusts issued by crypto asset manager Grayscale Investments (valued at $807 million) and custody provider Bitwise (valued at $66 million).

While court documents mention assets totaling $744 million, this is due to valuation figures as of October 25, 2023. The assets have since increased in value.

*Order authorizing FTX Trading to sell trust assets.Source: Kroll*

Nearly four weeks ago, FTX Debtors filed a motion with Judge John Dorsey on November 3 seeking the sale of six cryptocurrency trusts, including the Grayscale Bitcoin Trust (GBTC), the Grayscale Ethereum Trust (ETHE), and the Bitwise 10 Cryptocurrency Index Fund (BITW).

FTX currently holds over 22 million units of GBTC (Grayscale’s flagship Bitcoin product) currently worth $691 million, while its 6.3 million shares of ETHE are currently worth approximately $106 million.

Grayscale’s Ethereum Classic Trust (ETCG), Litecoin Trust (LTCN) and Digital Large Cap Trust (GDLC) are three other trusts that FTX can now sell in order to recover funds for affected FTX customers.

*As of October 25, FTX’s holdings in Grayscale and Bitwise stock were worth $744 million, but the valuation has since increased.Source: Kroll*

The administrators of FTX, headed by John. J Ray III has been working to recover assets since Sam Bankman-Fried’s former empire collapsed in November 2022.

So far, approximately $7 billion in assets have been recovered, nearly half of which are cryptocurrencies ($3.4 billion).

In June, FTX’s debtors estimated misappropriation of customer assets totaled $8.7 billion.

related: FTX Foundation staff strives for the $275,000 bonus promised by SBF

Meanwhile, Bankman-Fried was found guilty of seven fraud-related charges on November 2 and is expected to be sentenced on March 28.

He remains incarcerated at the Metropolitan Detention Center in Brooklyn, where he recently paid four mackerel in exchange for a haircut.

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