FTX Ventures and Dave Reach Agreement on $100 Million Stake
Fintech firm Dave is set to acquire a $100-million convertible promissory note from FTX Ventures, the venture capital arm of bankrupt crypto exchange FTX. The deal, pending approval from a bankruptcy court, involves Dave purchasing the note at a discounted price of $71 million. A hearing for approval is scheduled for January 25. A convertible promissory note is a financial instrument commonly used by startups that functions as a loan that can be converted into a share of the company at a later stage.
Collaboration Between Dave and FTX
Dave and FTX began their partnership in March 2022 to facilitate cryptocurrency payments on Dave’s platform. As part of the collaboration, FTX Ventures made a $100-million investment in Dave. However, following FTX’s bankruptcy in November 2022, various investments, payments, and donations made by FTX and its subsidiaries were reclaimed by the bankruptcy court.
FTX Debtors Seek Asset Liquidation
FTX debtors have filed requests to liquidate the company’s assets to repay creditors since November 2022. The court has already approved several sales, including the divestment of LedgerX and the liquidation of digital assets worth $3.4 billion. Efforts are being made to resolve issues between FTX and Genesis. Out of approximately $8.7 billion in misappropriated customer funds, at least $7 billion in assets have been recovered. The legal battle surrounding FTX’s bankruptcy could extend over several years due to multiple parties fighting over remaining assets and clawback claims.
Hot Take: Dave Acquires Stake in FTX Ventures
Dave has reached an agreement to acquire a $100-million stake from FTX Ventures, pending court approval. This deal allows Dave to purchase the convertible promissory note at a discounted price of $71 million. The collaboration between Dave and FTX began in 2022 but was impacted by FTX’s bankruptcy. As FTX debtors seek to liquidate assets, the legal battle surrounding the bankruptcy is expected to be complex and time-consuming. However, efforts are being made to recover funds and resolve issues between parties involved. The outcome of this bankruptcy case will have significant implications for both FTX and its creditors.
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