- FTX to sell $744M in Grayscale Trust Asses to pay creditors.
- $7 billion asset recovery, including $3.4 billion in cryptocurrency, has been achieved so far.
According to a bankruptcy court filing filed on Friday, bankrupt cryptocurrency exchange FTX just gained consent from a bankruptcy court to sell its shares in digital trusts administered by Grayscale Investments.
This action is a component of FTX’s calculated attempts to pay back billions to creditors.
The assets, which were estimated to be worth $744 million as of last month, are essential to FTX’s strategy for handling its bankruptcy.
Developed by Bitwise and Grayscale, these shares in different digital trusts give investors direct access to cryptocurrencies without requiring them to maintain self-custody.
With momentum indications pointing to more increases, the FTX coin FTT is up 8% and may break out of its consolidation.
The rise was in tandem with FTX exchange receiving authorization to begin selling $744 million in Grayscale assets in order to pay off creditors in full.
The sale will take place at the right moment to maximise value without upsetting the cryptocurrency market.
Following accusations of fraud that led to its bankruptcy declaration last year, FTX has been working to reclaim assets and pay off a complicated web of debts.
A $7 billion asset recovery, including $3.4 billion in cryptocurrency, has been accomplished thus far by FTX’s administrators, demonstrating the extent and intricacy of the company’s financial entanglements.
The court’s approval for FTX to move forward with these asset transactions is a crucial development in the company’s reorganisation strategy. It highlights the difficulties bitcoin exchanges have in striking a balance between asset sales and preserving stable market conditions.
This is especially important considering the erratic nature of the cryptocurrency market and the possible consequences of selling such large amounts of assets.
Market watchers and the larger cryptocurrency community are busy monitoring how FTX’s asset sales impact the market as it enters this pivotal phase of its asset sale and restructuring.
The U.S. Securities and Exchange Commission (SEC) has come down heavily on exchanges that are unregulated and refuse to play by the rules. It is still looking for evidence to support Binance insider trading claims. As per allegations, it is possible that the US based unit of Binance possessed a backdoor system similar to FTX’s, giving them possible control over client assets.
Disclaimer: This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
