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FTX Receives Court Approval to Liquidate $3.4 Billion in Crypto Assets
• September 16, 2023 4:14 pm • CommentsBankrupt cryptocurrency exchange FTX has been granted court approval to liquidate its $3.4 billion in cryptocurrency assets, a significant development in its ongoing Chapter 11 bankruptcy proceedings.
The move comes as the exchange seeks to repay its creditors and navigate the aftermath of one of the largest financial crimes in US history.
FTX’s proposal to liquidate its crypto holdings, which include assets like Solana (SOL), Bitcoin (BTC), and Ethereum (ETH), was initially submitted in August.
The court approval, granted by Judge John Dorsey, allows FTX to sell, stake, or hedge its digital assets, with a cap of up to $100 million in cryptocurrency sales per week. If both creditor committees agree, the liquidation pace can be increased to $200 million per week.
JUST IN: FTX receives court approval to liquidate $3.4 billion in crypto assets
• Solana
• Bitcoin
• Ethereum
• WBTC
• WETH
• USDT
• XRP
• STG
• APT
• BIT— Watcher.Guru (@WatcherGuru) September 13, 2023
Watcher.guru reports:
The collapse of cryptocurrency exchange FTX stands as one of the largest financial crimes in US history. Indeed, as co-founder and former CEO Sam Bankman-Fried awaits his October trial, the remnants of the platform are engulfed in Chapter 11 bankruptcy proceedings. Now, a massive moment in those proceedings has taken place.
Following a submitted proposal, FTX has received court approval to liquidate its $3.4 billion in crypto assets.
Moreover, the decision will now grant the bankrupt exchange the chance to either sell, stake or hedge its abundant crypto holdings.
The decision to liquidate cryptocurrency assets is aimed at minimizing the risks associated with price volatility in the crypto markets while facilitating the repayment of affected creditors.
FTX argued that hedging its crypto assets would limit potential downside risks before selling Bitcoin or Ethereum. Additionally, staking would benefit the estate and ultimately the creditors, according to the exchange.
FTX has also revealed that in addition to its digital assets, it owns 38 real estate properties in the Bahamas. The liquidation of cryptocurrency is a crucial step in repaying creditors and potentially recovering more funds for those affected by the bankruptcy.
The bankruptcy of FTX has been a significant event in the cryptocurrency industry, stemming from allegations of misusing and losing billions of dollars in customer crypto deposits.
US Bankruptcy Court (Delaware) gives the green light for FTX to liquidate assets to pay off creditors. 📜 Court docs reveal a diverse crypto portfolio with $SOL (55.8M coins) as the top holding, followed by #BTC and #ETH. Part of the #SOL holding is locked in a vesting schedule. pic.twitter.com/Cf4xXey0PL
— Lab4crypto (@Lab4crypto_) September 14, 2023
Reuters.com reports:
Dorsey allowed FTX to increase its liquidation pace to up to $200 million per week, if both creditors committees agree.
FTX said in a Monday court filing it owns $3.4 billion in cryptocurrencies, including $1.16 billion in Solana, $560 million in bitcoin, and $192 million in ether.
FTX filed for bankruptcy in November 2022 in the wake of claims that it misused and lost billions of dollars worth of customers’ crypto deposits.
FTX has recovered more than $7 billion in assets to repay customers, and it is pursuing additional recoveries through lawsuits against FTX insiders and other defendants that received money from FTX before it went bankrupt.
FTX founder Sam Bankman-Fried has pleaded not guilty to charges that he defrauded FTX customers by using their funds to prop up his own risky investments. Other former FTX executives have pleaded guilty to criminal charges.
FTX has already recovered more than $7 billion in assets to repay customers and continues to pursue additional recoveries through legal action against FTX insiders and other defendants involved in the case.
FTX’s founder, Sam Bankman-Fried, is awaiting trial in October and has pleaded not guilty to charges of defrauding FTX customers by using their funds for his risky investments.
Several former FTX executives have pleaded guilty to criminal charges related to the case.
The court’s approval of FTX’s cryptocurrency liquidation plan marks a significant step forward in resolving the aftermath of the exchange’s collapse and provides a framework for repaying affected creditors while managing the inherent risks associated with crypto asset sales.
What are #FTX's largest holdings, and could a selloff potentially impact the market?
With FTX gaininig court approval to liquidate $3.4 billion in crypto assets, here's a breakdown of their top #crypto holdings and $SOL's unlock schedule. ⬇️ https://t.co/iPPG0kaUiG
— CoinGecko (@coingecko) September 14, 2023
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