Court Approves FTX's Sale of $873M Grayscale and Bitwise Trust Assets

The cryptocurrency exchange, FTX, has been granted the legal green light to liquidate trust assets valued at around $873 million, including positions in Grayscale and Bitwise investment funds. This approval was sanctioned by a Delaware bankruptcy court, as outlined in a filing last Friday.

The court document explicitly outlined that FTX was granted the authority, though not an explicit directive, to conduct the sales of these trust assets based on reasonable business judgment, providing a detailed framework for the sale procedures. Additionally, Galaxy, a cryptocurrency investment firm, had its role expanded to assist FTX in the divestment of its trust assets, according to a filing on the subsequent Tuesday. Galaxy had been previously engaged by FTX earlier in the year to manage the comprehensive digital asset holdings within the estate.

FTX's trust assets comprised holdings in various Grayscale funds, including the Grayscale Bitcoin Trust (GBTC) and a Bitwise crypto index fund. As of October 25, these assets were appraised at $744 million, according to a court document filed on November 3. 

FTX Trust Assets Liquidation: Insight from Kroll Analysis 

However, with the diminishing discount of GBTC to its net asset value amid a surge in Bitcoin prices, FTX's trust holdings could now be valued at approximately $873 million. This estimate is based on Bitsday's calculations, utilizing reported shareholdings in the court filing and market closing prices on Wednesday according to TradingView data. The approximately 17% appreciation in value since October 25 corresponds with the recent uptrend in cryptocurrency prices.

FTX, once a prominent global trading platform led by Sam Bankman-Fried, encountered financial turmoil and ultimately declared bankruptcy in November of the preceding year. The collapse was triggered by a Bitsday report that laid bare the precarious financial situation of FTX's sister trading firm, Alameda Research.

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