The now-bankrupt former crypto giant FTX continues to cause turmoil, even under the control of a trustee. The company has been taking controversial steps for a while and recently announced it would repay creditors with altcoins at pre-crash values in cash. It has now shaken the markets with a billion-dollar sale.
Cryptocurrencies Decline
Redemptions of GBTC continue, and investors have made net withdrawals of over 2 billion dollars. It has been revealed that 1 billion dollars of this was conducted by the FTX trustee. The bankruptcy committee, waiting for ETF approval to sell GBTC assets, became the main cause of the negative sentiment in cryptocurrencies due to the GBTC reserve contraction. As the company moved thousands of BTC to Coinbase addresses, we saw the price of BTC fall.
There had been an announcement that a definitive agreement would be made in December to reactivate the exchange, but this also fell through. Nevertheless, the FTT Token price continues to find buyers at $2.74.
In the next phase, we will likely see a rise in reactions as the trustees probably announce the sale of all FTT assets, indicating they no longer have any connection to this token.
Grayscale Lawsuit
The bankrupt cryptocurrency exchange FTX’s affiliate Alameda Research (the company that lost FTX customers’ money in high-risk trades) has withdrawn its lawsuit against digital asset manager Grayscale Investments, which it accused of “enriching itself at the expense of shareholders.”
Alameda, which filed the lawsuit last March, had accused Grayscale of charging high fees. Fortunately, the SEC approved the ETF applications, making it possible for GBTC to convert from a trust to an ETF. Therefore, the lawsuit became unnecessary.
FTX’s subsidiary is likely taking this step to avoid unnecessary legal expenses. We have been discussing for months that SEC approval for GBTC was vital for DCG’s survival. The company, which paid off its debts to Genesis before approval, is now starting to escape legal troubles.
Grayscale CEO Michael Sonnenshein, along with parent company Digital Currency Group (DCG) and its CEO Barry Silbert, were targeted in the lawsuit.
