After getting the green light from a judge to gradually sell around $3.4 billion in digital currency assets in Sep, the bankrupt FTX crypto exchange has appealed to the Delaware bankruptcy court. They want permission to sell specific, important trust fund assets. These assets, including holdings from cryptocurrency asset manager Grayscale Investments and custody service provider Bitwise, have an estimated value of $744 million.
In a court document filed on Nov 3, FTX debtors formally requested permission from the court to sell trust assets. This sale is intended to facilitate the company’s preparations for upcoming distributions to creditors in US dollars.
In addition, the value of one Bitwise trust is $53 million, and that of five Grayscale trusts amounts to $691 million combined. These trusts help investors tap into cryptocurrencies. They don’t need to own the assets involved directly.
The court paper explains:
The Debtors think that actively working to lessen price changes is the best method to protect the worth of the Trust Assets. It results in the biggest profits for those owed money. It also helps ensure money is spread evenly in the Debtors’ new plan.
FTX Debtors Seek Approval For Trust Asset Sale & Pricing Committee Inclusion
The FTX debtors requested an investment adviser’s approval to sell trust assets and determine sale methods. They suggested including a pricing committee, comprised of stakeholders, as part of the selling process.
FTX debaters recently asked for trust assets to be sold. It follows the court’s previous decision to approve liquidating about $3.4 billion in crypto assets. The court instructed this sale should be broken down into chunks of $50 million and $100 million. This method avoids causing a market dump.
FTX’s court case about bankruptcy is going on. At the same time, Sam Bankman-Fried, its past CEO, was proclaimed guilty on every one of the seven charges in his criminal case in New York.
Furthermore, the list of charges has two for wire fraud, two more for plans to do wire fraud, another for securities fraud, one more for plans to do commodities fraud, and one for plans to launder money. The date to decide his punishment is Mar 28, 2024. Theoretically, he could face 115 years in jail, but realistically, that could be between 15-20 years, according to experts.
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