FTX, a crypto exchange that has faced difficulties, is enlisting the help of a reputable crypto asset management firm to handle its recovered digital assets.
Taking over the management of crypto
The exchange has filed a request with the court to allow Galaxy Digital, led by billionaire Mike Novogratz, to take over the management of its virtual currencies as part of its restructuring process.
FTX has chosen Galaxy Asset Management based on their expertise and qualifications, which are explained in detail in the Investment Services Agreement Motion and the Kurz Declaration.
Furthermore, FTX has determined that the proposed fee structure in the Investment Services Agreement is reasonable and appropriate for the services that Galaxy Asset Management will provide.
As per the information mentioned in the document, it is not possible for FTX to sell the retrieved cryptocurrencies on a crypto exchange as it can lead to a supply shock, which can negatively impact the prices of digital assets.
The Debtors cannot risk flooding the market and reducing the value of such digital assets by selling large digital asset positions directly on an exchange.
FTX had initially filed for bankruptcy in November 2022, following the suspension of customer withdrawals.
Sam Bankman-Fried, the founder and former CEO of FTX, is accused of mishandling billions of dollars of customer funds and defrauding investors, which could lead to decades of imprisonment if found guilty.
Recently, FTX recovered $7 billion worth of crypto assets, although reports suggest that the crypto exchange still owes its customers approximately $8.7 billion.
In other recent news, according to Glassnode, a crypto analytics firm, Bitcoin (BTC) could experience a rapid surge towards a new all-time high, much faster than what traders and analysts expect.
Co-founders Jan Happel and Yann Allemann, who use the Negentropic handle on X social media platform, believe that the US dollar index (DXY) will climb to 106.
