FTX Transfers Token As Bankruptcy Proceeding Proceeds

Large transfers of funds linked to the bankrupt cryptocurrency exchange FTX have been observed. 

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Some sources have reported the transfer of up to $10 million worth of digital assets including Ethereum (ETH) and other altcoins from the Solana (SOL) blockchain to Ethereum since August 31st. These transfers were made via the Wormhole bridge to another FTX wallet.

FTX Transfer of Assets Sparks Fear of Price Dump

The movement of the funds was discovered by blockchain analytics platform Arkham Intelligence. Notably, these transfers have sparked fears in the minds of netizens who speculate that the tokens may be about to be sold and thereby, trigger a price dump. 

Mike Novogratz’s Galaxy Digital Capital Management was chosen by FTX to oversee the sakes and management of its recovered digital asset holdings.

FTX also proposed a limit to token sales with the intention to minimize the impact on the market. The typical limit was placed at $100 million per week with a plan to permanently raise the maximum limit to $200 million on a token-by-token basis per week. 

FTX Debtors Request Notice For Token Sales 

In addition, the FTX Debtor filing requested that a ten days notice be given to the Committee and Ad Hoc Committee of creditors when there is a potential sale of Bitcoin (BTC), Ethereum and certain “insider” digital assets. The proposal is yet to be binding but at the same time, it is expected to go before the Delaware Bankruptcy Court on September 13th.

An April filing revealed that there is currently $3.4 billion in crypto holdings. Although, the exact breakdown of how much the estate holds in larger, more liquid tokens like BTC and ETH is yet to be made public, instead the estate has made known its holdings of relatively liquid tokens. 

FTX Filing Shows Unauthorized Trades by Executives 

Meanwhile, the exchange’s debtors have discovered some exposing trades which were deliberately advantageous for the company’s executives. Several payments and exchange of properties were made by FTX executives prior to when the crypto exchange imploded and filed for bankruptcy. 

Some of the executives implicated on this basis are former Chief Executive Officer (CEO) of the exchange Sam Bankman-Fried, Gary Wang, former FTX director of engineering Nishad Singh, former FTX chief marketing officer Darren Wong, and former FTX chief operating officer Constance Wang.

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