Bankrupt FTX Granted Permission to Sell $3.4 Billion Worth of Crypto Holdings to Pay Creditors
A US judge has ruled that bankrupt crypto exchange FTX can sell and invest its crypto holdings, which are valued at over $3.4 billion, in order to repay its creditors. Judge John Dorsey of the US Bankruptcy Court for the District of Delaware approved the motion and dismissed objections to the plan. FTX currently holds $1.16 billion worth of solana crypto tokens and approximately $560 million in Bitcoin, along with other illiquid tokens.
An attorney representing the ad hoc committee of FTX customers supported the plan during the hearing. They argued that the digital assets being sold are assets of the debtors themselves.
Former CEO of FTX Denied Bail Ahead of Trial
In related news, Sam Bankman-Fried, the former CEO of FTX, has been denied bail ahead of his trial next month. He had been on house arrest in California since December 2022 while awaiting trial on charges of fraud and money laundering.
The US authorities have charged Bankman-Fried with wire fraud, conspiracy to commit money laundering, and conspiracy to misuse customer funds. He is also facing lawsuits by the SEC and CFTC for similar charges. Bankman-Fried was arrested in the Bahamas on December 12, 2022, and extradited to the US on December 21.
Hot Take: FTX Granted Opportunity to Settle Debts Through Crypto Sales
A US judge has given bankrupt crypto exchange FTX permission to sell its crypto holdings worth more than $3.4 billion in order to repay its creditors. This ruling allows FTX to leverage its significant crypto assets, including solana tokens and Bitcoin, to settle its debts. Meanwhile, the former CEO of FTX, Sam Bankman-Fried, has been denied bail ahead of his upcoming trial on charges of fraud and money laundering. Bankman-Fried is facing multiple legal actions from US authorities, including the SEC and CFTC. The outcome of these cases will have significant implications for the future of FTX and the broader crypto industry.
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