FTX 2.0 Coalition Raises Doubts on Galaxy Digital’s Crypto Holdings Role

FTX, once a thriving beacon of the crypto world, faced a catastrophic collapse in November 2022. The debacle was a tragic outcome of human folly and reckless ambition.

FTX’s downfall was not sudden but a slow unravelling. The mishandling of risk, blatant disregard for rules, and a trail of broken promises led to the total annihilation of a once-great dream. Behind the façade of innovation was a grim tale of financial wreckage that left countless customers, investors, and employees in despair.

In the aftermath, the formation of the FTX 2.0 Coalition emerged as a striking reaction. Committed to seeking justice and compensation, their mission seemed both valiant and desperate.

FTX’s Offer to Ad Hoc Committee

FTX has proposed to pay substantial fees to the Ad Hoc Committee (AHC), who previously sued the company for recognition of trust per the terms of service. FTX’s offer includes up to $675k monthly and a $3.5M fee upon plan confirmation. However, there’s a catch: if the AHC pursues litigation regarding the trust, the agreement is off. In the words of the Coalition, this arrangement seems like “a dog on a leash.”

Galaxy Digital – A Friend or Foe?

The choice of Galaxy Digital to manage crypto holdings is more puzzling. Their admission of withdrawing large sums (nearly $76 Million) just before the collapse and the decision to do business with them smacks of something more than mere coincidence. Something is fishy. The creditors are at stake here!

Was there a darker motive at play, or was this just another bad decision in a string of many?

What’s at stake here is more than money; it’s about confidence in an industry that promises transparency and fairness.