As the cryptocurrency market gradually recovers and FTX Group enters the final stage of bankruptcy restructuring, the prices in the FTX credit market have also risen. According to data as of December 22nd, each dollar can be redeemed for 67 to 72 cents. Taking advantage of this opportunity, cryptocurrency asset management firm Iikigai Asset has decided to sell off its holdings.
Background information:
FTX’s collapse: Can Bitcoin Spot ETF bring in the most liquidity?
Cryptocurrency exchange FTX announced its entry into bankruptcy restructuring in November last year due to misappropriation of customer assets. The collapse of FTX has had widespread implications, with over 70 investment institutions affected, including prominent Western institutions such as Multicoin, Genesis, and Paradigm. Unable to withstand the significant reduction in funds and the resulting liquidity constraints, Galois Capital, one of the world’s largest cryptocurrency quant funds managing $200 million, decided to halt all trading and positions in February this year. They returned 90% of customer funds that were not locked in FTX and sold the remaining 10% at a discounted price of 16% to cash out their FTX credit urgently.
Extended reading:
FTX’s heavy blow: Galois Capital sells $45 million in credit at a discount of “1.6 times” and announces closure
FTX credit prices soar
However, as the cryptocurrency market gradually recovers and FTX Group enters the final stage of bankruptcy restructuring, according to data from Cherokee Acquisition, the prices in the FTX credit market have risen from 50 to 53 cents per dollar at the end of October to 67 to 72 cents per dollar on December 22nd, an increase of more than 34%.
Ikigai Asset sells its £65 million claim: Waiting further is meaningless
In response to this, cryptocurrency asset management firm Iikigai Asset, which once had all its assets in FTX, has sold its £65 million claim. Its founder, Travis Kling, also tweeted that the decision to sell FTX credit was mainly based on opportunity cost, weighing and comparing the potential growth of credit prices in the future with the returns that can be obtained by obtaining cash and investing in other assets. He stated that although Travis Kling did not disclose the specific amount of funds trapped in FTX, Iikigai Asset is currently regrouping. For the first time since the collapse of FTX, they have opened new subscriptions to existing investors. Currently, their investors are also injecting new capital, and internal mechanisms have been adjusted to prevent a recurrence of the FTX bankruptcy tragedy.
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FTX
FTX credit
Iikigai Asset
Travis Kling