Bankruptcy proceedings continue for the FTX exchange, a former big rival of Binance. The crypto company founded by SBF continues to seek the right solutions to reimburse its creditors and customers. Also, the court recently announced a decision that could greatly help the bankrupt exchange in its task. Find out what it is.
FTX will only be able to sell its low value assets!
On January 18, FTX’s liquidators filed a petition in the US Bankruptcy Court for the District of Delaware. According to their motion, they wanted sell or transfer some of the exchange’s investment assets and subsidiaries. They explained in the application that some recipients of the investments would like to buy out FTX’s interests. Buyouts would make it easier to raise additional capital from other investors to pay the company’s debts.
On February 13, the court announced that it is giving its approval to the request of FTX’s liquidators. Concretely, the liquidators have the authorization to sell or transfer certain assets of a “relatively small value» compared to all assets. In this sense, the total sale price of each asset must not exceed $1 million.
The assets concerned are those of investments made in private and public companies. FTX may sell, for example, the warrants, shares, promissory notes and tokens it owns. It may also proceed with the sale or transfer of its future equity investments and its subsidiaries.
The court filing noted that the debtors will have to keep the courts informed of the progress of the transactions. Any receipt of offers by FTX’s liquidators must be disclosed to the firms serving as legal counsel and principal financial advisor to the Official Committee as well as to the US Trustee.
According to The Block Research, FTX and Alameda made 473 investments that cost them a total of $5.3 billion. They notably invested $100 million in Mysten Labs, the developer of the Sui blockchain. They also made smaller investments by offering $1 million checks to startups Limit Break and Messari. According to the liquidators’ initial request, FTX made 185 small investments. So, for each of the latter, the exchange signed a check for an amount not exceeding 1 million dollars.
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