FTX Receives Court Approval to Liquidate its Crypto Holdings

Bankrupt cryptocurrency exchange FTX has been approved by the bankruptcy court to liquidate its crypto assets worth $3.4 billion.

Meanwhile, the company’s former CEO, Sam Bankman-Fried, may stay in prison until his scheduled trial in October after a US Judge denied his requests for a pretrial release.

• Judge John Dorsey of the US Bankruptcy Court in the District of Delaware on Sept. 13 approved FTX’s motion to sell its crypto assets comprising Solana (SOL), Bitcoin (BTC), Ethereum (ETH), and other tokens worth $3.4 billion.
• In a filing on Sept. 11, FTX revealed its four top holdings, with SOL being its largest bag at $1.16 billion, BTC worth $560 million, ETH worth $192 million, and Aptos (APT) at $137 million. The company’s funds also include brokerage assets, cash, and government-recovered assets.
• FTX’s request to liquidate received support from the ad hoc committee of non-US customers and the official creditors’ committee.
• Both said it was important for FTX to de-risk its token portfolio and liquidate its holdings in “a market favorable way” over an appropriate period with the help of an investment expert to maximize cash distributions to users.
• The bankrupt crypto exchange earlier revealed plans to select Galaxy Digital to sell, stake, and hedge its crypto to reduce the risk of price volatility and also repay affected customers in US dollars.
• Meanwhile, Judge Dorsey overruled letters filed by two FTX customers who objected to the liquidation, stating that they failed to “establish their ownership interests” in any particular Bitcoin or cryptocurrency that the debtors might hold, given that other parties agreed to the motion.
• Former FTX chief Sam Bankman-Fried is scheduled to face trial on Oct. 3, 2023, on criminal charges for which he previously pleaded not guilty. Bankman-Fried recently failed to secure a bid for a temporary release from jail to prepare for his upcoming trial.