FTX receives approval to sell $3.4 billion in bitcoin, ethereum, and solana.

In a momentous milestone, the United States Bankruptcy Court for the District of Delaware has granted FTX permission to sell, invest, and hedge its crypto assets worth over $3.4 billion to satisfy outstanding debt.

This decision comes after FTX’s legal team requested permission to sell digital assets, noting the benefits of hedging crypto assets and producing returns for creditors by staking particular digital assets.

Judge John Dorsey presided over the court session when he not only approved the request but also overturned two opposing parties’ objections. This critical move enables FTX to begin the process of selling, staking, and hedging its significant crypto holdings.

FTXRELOADED on Twitter: "Breaking news, @FTX_Official is finally authorized to sell its crypto reserve. pic.twitter.com/G4OKSWn3Ny / Twitter"

Breaking news, @FTX_Official is finally authorized to sell its crypto reserve. pic.twitter.com/G4OKSWn3Ny

FTX Alters Crypto Asset Sale Strategy

On September 12th, FTX revised its plan to sell billions of dollars in crypto assets in response to concerns made by the U.S. Trustee, the bankruptcy department of the Department of Justice. The first idea was met with opposition from the United States Trustee, who stated that intentions to sell Bitcoin (BTC) or Ethereum (ETH) should be fully known so that others may oppose.

However, under the current plan, FTX intends to avoid publishing prior public announcements of transactions, owing to the potential market impact. The mere thought of a significant crypto player unloading up to $100 million in assets each week has already dampened crypto values, according to Coindesk.

To achieve a happy medium, FTX has promised to keep the US Trustee confidentiality informed about its transactions, resolving the regulatory body’s concerns. This information sharing will be extended to committees representing the exchange’s creditors, assuring openness. FTX thinks that these changes will be enough to placate its opponents when Judge John Dorsey considers the plan in a Delaware courtroom.

After the sins of FTX’s management were revealed, FTX.com, its sister company Alameda Research, and around 130 of its subsidiaries filed for bankruptcy last November. Sam Bankman-Fried, the Founder and Former CEO of FTX, is currently behind bars awaiting trial on multiple civil and criminal allegations. Other top FTX and Alameda officials have pleaded guilty and are collaborating with the authorities.

The insolvent exchange costs were shifted to John J. Ray III, who took over as CEO of FTX following the bankruptcy declaration.

A Huge Cryptocurrency Stash

FTX was a popular cryptocurrency exchange that expanded rapidly. Last August, the administrator of FTX recommended liquidating the crypto assets, $3.4 billion of which were held by the bankrupt exchange. The concept includes a staged token sale with a weekly cap of $100 million, which can be expanded to $200 million on an individual token basis. Mike Novogratz, CEO of Galaxy Digital, will be named as the investment manager in charge of the transaction.

FTX is anticipated to have $685 million in locked Solana tokens, $529 million in FTT tokens, $268 million in Bitcoin, and $90 million in Ethereum as of January 2023. Along with stablecoins, the insolvent exchange holds $67 million in Aptos, $42 million in Dogecoin, $39 million in Polygon, and $29 million in XRP.

FTX also has $1.2 billion in cryptocurrencies on third-party cryptocurrency exchanges. Recently, new court records showed that the exchange owned $1.6 billion in Solana and $560 million in Bitcoin, as well as $200 million in real estate in The Bahamas.

Wu Blockchain on Twitter: "As of August 31, FTX held a total of US$3.4 billion in crypto assets, including:US$1.16 billion SOL$560 million BTC$192 million ETH$137 million APT$120 million USDT$119 million XRP$49 million BIT$46 million STG$41 million WBTC $37 million WETH. Read more... pic.twitter.com/fJ7ntAiEdk / Twitter"

As of August 31, FTX held a total of US$3.4 billion in crypto assets, including:US$1.16 billion SOL$560 million BTC$192 million ETH$137 million APT$120 million USDT$119 million XRP$49 million BIT$46 million STG$41 million WBTC $37 million WETH. Read more... pic.twitter.com/fJ7ntAiEdk

Closing Thoughts:

To summarize, while the fear of a crypto crisis triggered by FTX’s prospective asset sale looks exaggerated, it is critical to be cautious in the ever-volatile crypto market. Understanding the complexities of these processes and their possible impact can assist investors in making educated judgments in an ever-changing market.

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Bankrupt Crypto Exchange FTX’s Stash Selling Has Resulted In Market Downtrend was originally published in Invest Gaming Journal on Medium, where people are continuing the conversation by highlighting and responding to this story.