FTX Alters Bitcoin and Crypto Sale Proposal Unexpectedly

FTX, the crypto exchange currently going through bankruptcy proceedings, has made adjustments to its proposal for the sale of its Bitcoin and crypto holdings in response to concerns raised by the US Trustee, the bankruptcy branch of the Department of Justice. The initial proposal aimed to liquidate $3.4 billion in Bitcoin and other crypto assets, causing worries about the potential impact on the market. In an effort to address these concerns, FTX has revised its plan, which is set to be reviewed in a Delaware Bankruptcy Court on September 13.

The original proposal had suggested appointing Galaxy Digital, led by Mike Novogratz, as the investment manager responsible for overseeing the sale and management of the recovered assets. Under this plan, FTX would have been able to sell up to $100 million worth of tokens per week, with the possibility of increasing the cap to $200 million on an individual token basis.

The revised proposal states that FTX will not be required to issue advance public notice of these transactions due to their potential to significantly affect market prices. This decision takes into consideration the fact that the mere prospect of a crypto entity selling up to $100 million of assets weekly has already had a negative impact on market sentiment. However, FTX has agreed to keep the US Trustee and the committees representing the exchange’s creditors informed about the sales.

As of August 31, FTX’s holdings include $1.16 billion in Solana’s SOL, $560 million in Bitcoin, $192 million in Ethereum, $137 million in APT, $120 million in USDT, $119 million in XRP, $49 million in BIT, $46 million in STG, $41 million in WBTC, and $37 million in WETH. It is worth noting that a significant portion of FTX’s SOL tokens is locked and will only be fully vested between 2025 and 2028, which means any sale would require a buyer to take over FTX’s vesting contract, preventing a sudden massive sell-off of SOL tokens.

Renowned crypto trader Hsaka has expressed concerns about potential information disparity resulting from FTX’s revised liquidation plan. He highlighted that while market makers and over-the-counter buyers might receive crucial price-moving information, smaller investors could be left in the dark. The transparency of FTX’s changes to the plan is also being questioned, although the court order authorizing the liquidation suggests that the interests of all stakeholders have been considered. The decision of Judge John Dorsey in the Delaware courtroom and the subsequent market reactions will be closely watched by the Bitcoin and crypto community.

At the time of writing, Bitcoin was trading at $26,124.

Source: [Hyperlink](https://restructuring.ra.kroll.com/FTX/Home-DocketInfo)
Source: [Hyperlink](https://www.newsbtc.com/news/solana/solana-sol-price-plunges-ftx-rumors/)
Source: [Hyperlink](https://www.tradingview.com/x/oIPuPX2Y/)
Featured image from The Conversation, chart from TradingView.com

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J-S Tremblay
About the author - J-S Tremblay

I've been involved in the cryptocurrency world since 2016 and trading since 2019. I started Moon and Lambo in 2021. I'm passionate about crypto and love to share my knowledge. I hate bankers and I hope that cryptocurrency will change the financial world for the better. View full profile...

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