Bankrupt FTX Crypto Exchange Settles Dispute, Sells European Unit Back to Founders
Summary:
FTX, a bankrupt crypto exchange, has settled a dispute regarding its European division, selling it back to its original founders for $32.7 million. This agreement follows a lawsuit by FTX alleging that the acquisition was financed with customer funds and that the purchase price was excessively high. Various attempts to acquire FTX Europe followed its bankruptcy, including two from U.S. crypto exchange Coinbase. The company debuted a website for European customers to request withdrawals post-bankruptcy in March 2023. FTX is nearing the end of its bankruptcy process and aims to fully repay billions of dollars to its customers.
FTX, a bankrupt cryptocurrency exchange, has resolved a conflict concerning its European unit, handing it back to the original proprietors. As per a Reuters report on February 24, FTX agreed to sell back FTX Europe to its creators for about $32.7 million, hinting at hardships securing alternate buyers. Swiss firm Digital Assets AG (DAAG), which was later christened FTX Europe, was bought for a whopping $323 million in 2021. Before approving this sale, FTX sought to recoup the money used for the purchase. The exchange brought forward a lawsuit claiming the procurement was executed with client funds, labeling the acquisition cost as a significantly undue payment. Accusations were rejected by startup founders, Patrick Gruhn and Robin Matzke, who retaliated by demanding $256.6 million from FTX. As Reuters detailed, the dispute was eventually settled on February 21.
FTX Europe was included in FTX's United States Chapter 11 filing in November 2022. Post its bankruptcy, various cryptocurrency exchanges eyed acquiring the European segment, aiming to gain some of FTX’s regional market influence. For instance, US crypto exchange Coinbase endeavored to procure FTX Europe twice, initially in November 2022 following the parent organization's striking unraveling, and then again in September 2023. Cryptocurrency entities Trek Labs and Crypto.com also reportedly showed interest.
The company had its operations in the region for just eight months. FTX Europe set up a website in March 2023 to enable European clients to request withdrawals for the first time post-declaration of bankruptcy. FTX is on the verge of wrapping up its bankruptcy proceedings, intending to remunerate billions to its clientele. To help reimburse the creditors, the company was allowed on February 22 to sell off more than $1 billion in Anthropic, a leading artificial intelligence company's stocks.
Published At
2/24/2024 7:31:48 PM
Disclaimer: Algoine does not endorse any content or product on this page. Readers should conduct their own research before taking any actions related to the asset, company, or any information in this article and assume full responsibility for their decisions. This article should not be considered as investment advice. Our news is prepared with AI support.
Do you suspect this content may be misleading, incomplete, or inappropriate in any way, requiring modification or removal?
We appreciate your report.