FTX creditors invited to bid on Solana tokens in new auction format FTX creditors invited to bid on Solana tokens in new auction format
FTX's management previous discounted sales of the Solana tokens had attracted criticisms from creditors.
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Updated: Apr. 22, 2024 at 3:51 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
FTX creditors have been urged to participate in the defunct exchange’s bankruptcy estate’s planned auction of its remaining Solana token holdings.
On April 20, Figure CEO Mike Cagney revealed that the next round of FTX’s locked Solana token sales would be via auction, compared to previous ones sold directly to venture capital firms like Galaxy Digital and Pantera Capital.
Consequently, Sunil Kavuri, a prominent FTX creditor, urged retail investors impacted by the collapse of the exchange to participate in the process. He said:
“[Figure] created a structure to allow retail FTX creditors to participate with a minimum investment of $5000 vs. the $5 million required to purchase from FTX.”
Figure Markets will create a special-purpose vehicle (SPV) to compete in the auction. The SPV will be available to accredited US and non-US investors who must pass a compulsory KYC process.
The SPV would engage in community consensus to decide on bid prices and subsequent investment management. It would accept investments in the US Dollar, USD Coin stablecoin, Bitcoin, and Ethereum.
Meanwhile, the defunct exchange has yet to provide additional information about the auction process as of press time.
The SOL tokens constitute a significant portion of FTX’s crypto holdings, and the exchange has been actively divesting them at discounted rates. The failed exchange recently realized $1.9 billion by selling SOL at $64 per token, well below its current market value.
These discounted sales have attracted significant criticisms from FTX creditors, who argued that the sales have destroyed values for them. Kavuri said:
“It’s not right for FTX to sell our property. Any value Sullivan & Cromwell and co-conspirators have destroyed for FTX creditors, they are being sued for through our class actions. This value is at current prices not their BS petition date pricing lies.”
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Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
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Solana is a high-performance blockchain platform that utilizes a unique consensus algorithm called “Proof of History” to achieve fast transaction speeds and low fees.
FTX
FTX is a defunct cryptocurrency exchange, currently in bankruptcy proceedings, that was founded by Sam Bankman-Fried and Zixiao “Gary” Wang in May 2019.
Alameda Research
Alameda Research was once a principal trading firm, operating as an arm of the failed crypto exchange, FTX.
Sam Bankman-Fried is the former CEO, and co-founder of defunct crypto exchange FTX and Alameda Research.
