FTX continues to move million of funds

Amid multiple ongoing investigations, FTX continues to move its funds. Addresses related to the failed crypto exchange reportedly transferred about $145 million in stablecoins to various platforms.

Furthermore, three wallets, allegedly associated with FTX and its subsidiary Alameda Research, moved 69.64 million USDT and 75.94 million USDC.

Wallets associated with FTX move millions of Tether

As noted by Lookonchain in recent days, three wallets associated with FTX and its subsidiary, Alameda Research, moved 69.64 million Tether (USDT) and 75.94 million USD Coin (USDC).

Tether reserves were moved to custodial wallets on platforms such as Coinbase, Binance, and Kraken. All USDC funds were transferred to a custodial wallet at Coinbase.

Both FTX and Alameda are in the process of recovering the assets, as they have to respond to requests to several investor groups to return the funds. According to FTX lawyer Andy Dietderich, by January 2023 the troubled platform had already recovered $5 billion in cash and liquid cryptocurrencies.

However, total liabilities exceeded $8.8 billion. The latest update on FTX’s bankruptcy case comes following the conclusion of a new deal with a company owned by the Abu Dhabi government.

Alameda Research sold its remaining stake in venture capital firm Sequoia Capital to Abu Dhabi’s sovereign wealth fund for $45 million. In March, Alameda Research filed a lawsuit against Grayscale Investments in the Delaware Court of Chancery.

The lawsuit specifically seeks to unlock $9 billion or more in value for shareholders of the Grayscale Bitcoin and Ethereum Trusts and to realize more than $250 million in asset value for FTX customers and creditors, according to a statement.

As lawsuits against FTX piled up, some plaintiffs called for the consolidation of lawsuits against the failed exchange. However, on 8 March, a judge denied the consolidation request, noting that the defendants have not yet been allowed to respond.

US District Judge Jacqueline Corley recently denied the request to consolidate five proposed class actions against FTX.

How much has FTX recovered since the collapse?

As anticipated, according to Andy Dietderich, a lawyer for FTX, the troubled cryptocurrency exchange has reportedly recovered $5 billion in cash and liquid cryptocurrencies. However, the company is still working to reconstruct the transaction history, and the overall customer deficit is still unclear.

The recovered assets do not include those seized by the Securities Commission of the Bahamas, including mostly the exchange’s FTT tokens. In addition, discussing with a bankruptcy judge in Delaware, Dietderich revealed that the company plans to sell non-strategic investments worth $4.6 billion.

These include subsidiaries such as LedgerX, Embed, FTX Japan and FTX Europe: these companies are independent of FTX and have segregated accounts. FTX Japan has already drawn up plans to return customer funds.

In addition, FTX will end its sponsorship agreement from 2021 to 2028 with the popular game League of Legends. As previously reported, FTX is estimated to have $8.8 billion in total liabilities.

At the time, several sources had reported that the exchange held assets with a total estimated value of $8 billion, but most were highly illiquid. In addition, Sam Bankman-Fried, the founder of FTX, pleaded not guilty to all criminal charges related to the exchange’s collapse.

The US Attorney’s Office for the Southern District of New York has formed a task force to track down and recover missing customer funds, as well as handle investigations and prosecutions related to FTX’s collapse.

Alameda Research divests stake in Sequoia Capital for $45 million

One of the latest updates on the FTX bankruptcy case comes as a new agreement between the exchange and a company owned by the Abu Dhabi government has been finalized. A document from the US Bankruptcy Court for the District of Delaware dated 8 March reveals that Alameda Research, FTX’s investment division, will sell its remaining stake in venture capital firm Sequoia Capital to Abu Dhabi’s sovereign wealth fund.

According to the document, FTX decided to enter into the agreement with the buyer based on its superior offer and ability to execute the sale transaction in a timely manner. This comes after interest in purchasing the shares was received from four different parties.

Al Nawwar Investments RSC Limited, the buyer of the Alameda stake, is owned by the government of Abu Dhabi, the capital of the United Arab Emirates. The release states that the buyer has already invested in Sequoia.

The deal, worth $45 million, could be finalized by 31 March. However, it is subject to approval by Delaware bankruptcy judge John Dorsey. The attempt to divest the remaining stake in Sequoia Capital is part of FTX’s efforts to liquidate its investments to pay off its debt to creditors.

Dorsey has been involved in some aspects of the lawsuits concerning FTX. After the initial bankruptcy filing, Dorsey granted FTX permission to sell some of its assets.

These assets included the LedgerX derivatives platform, the Embed stock clearing platform, and the company’s regional subsidiaries, FTX Japan and FTX Europe. As of January 2023, it was reported that FTX had recovered more than $5 billion in cash and liquid crypto assets.

In a related case on 8 March, court documents reveal Dorsey’s approval that Voyager Digital will allocate $445 million following the lawsuit filed by Alameda Research against the company for the repayment of loans.