A wallet linked to the bankrupt cryptocurrency exchange FTX has transferred $10 million worth of digital assets from the Solana SOL$19 network to Ethereum, raising worries that this might be the start of a sequence of token sell-offs during the exchange’s bankruptcy proceedings.
The FTX wallet has exchanged more than $4 million worth of cryptocurrencies and $6.23 million worth of ether since August 31, according to data from blockchain analytics company Arkham Intelligence.
These included FTX Token FTT$1.04 worth $1.2 million and Uniswap UNI for $1.8 million. $4.30, $1.3 million of HXRO (HXRO), $550,000 of SushiSwap (SUSHI $0.57), and $260,000 of Frontier Token were all transferred via the Wormhole Bridge to another FTX wallet.
On August 24, FTX put forth a proposal to assign Mike Novogratz’s Galaxy Digital Capital Management the responsibility of managing the sale of its recovered cryptocurrency holdings.
The FTX estate would only be allowed to sell $100 million worth of the tokens each week; however, that cap may be increased to $200 million for a specific token. These restrictions are meant to lessen the effects of token sales while still enabling FTX to fully compensate creditors.
The exchange additionally submitted a second motion to hedge its greater holdings of Bitcoin (BTC) at $25,713 and Ether in addition to this strategy.
The Delaware Bankruptcy Court is anticipated to hear the FTX token sales lawsuit on September 13; however, the claims made in the documents are not yet legally binding.
In a hearing on April 12, FTX said that it had recovered almost $7.3 billion in liquid assets, $4.8 billion of which were assets as of November 2022.
As of April 12, FTX had a total of $4.3 billion in crypto assets available for stakeholder recovery at market rates, per the documentation brought forth during the hearing.
As part of its current restructuring strategy, FTX may restart its cryptocurrency exchange. According to FTX CEO John Ray III, the business has “begun the process of soliciting interested parties for the reboot of the FTX.com exchange.”
The opening of the new exchange is anticipated to be finished some time in the second quarter of 2024, according to FTX lawyers.