Feb 11, 2024

FTX to Sell Digital Custody for $500K in Bankruptcy Move

FTX plans sale of Digital Custody for $500K in bankruptcy move

The Sale of Digital Custody by FTX Debtors Estate to CoinList for $500,000

The FTX debtors estate, led by CEO John Ray III, has announced the sale of Digital Custody to CoinList at a discounted price of $500,000. The financing for this sale is being provided by the original CEO of DC, Terence Culver. This marks a significant markdown from the initial purchase price of $10 million by FTX.

According to the legal filing by FTX, the acquisition of DC was intended to offer custodial services for FTX US and LedgerX. However, due to the bankruptcy filing by former CEO Sam Bankman-Fried in November 2022, DC was not fully integrated into the FTX ecosystem. FTX had acquired the company in two separate transactions of $5 million each in December 2021 and August 2022.

FTX’s legal team has stated that since FTX US has not been restarted, Digital Custody holds little value for the estate. In their words, “DCI is no longer useful to the Debtors’ business, given the Debtors’ sale of LedgerX and the unlikelihood of the Debtors selling or restarting FTX US.”

The Value of Digital Custody’s Custodial License

Despite this, Digital Custody still holds a custodial license from the South Dakota Division of Banking. After evaluating three offers, including one from Culver, the debtors have selected the best offer based on its ability to complete the sale quickly and the beneficial relationship with Culver. This is believed to facilitate regulatory approval swiftly.

Web 3.0 Cryptocurrencies and the Sale of Digital Custody

As the world of cryptocurrency continues to evolve, more and more projects are emerging in the Web 3.0 space. This sale of Digital Custody by FTX’s debtors estate is just one example of the changing landscape. With the rise of tokens like VVS Crypto, WLUNA Crypto, WAX Crypto, ZIL Crypto, and XCN Crypto, it’s clear that the future of crypto is moving towards a more decentralized and interconnected ecosystem. And with the recent announcement of the top 5 Web 3.0 crypto projects, it’s evident that the industry is constantly evolving and adapting to new technologies and opportunities.

Stay tuned to Crypto Press and the Cryptocurrencies Network for all the latest updates and news on the ever-changing world of Web 3.0 cryptocurrency.

FTX’s Legal Team Approves Transaction, Allows for Superior Offer

FTX’s legal team has confirmed that both the committee and ad hoc committee of non-U.S. customers of FTX.com have approved the transaction. However, as part of the agreement, FTX has the option to seek a better offer for DC until three days before the closing date. In the event that the buyer fails to complete the deal, a reverse termination fee of $50,000 will be imposed.

In a recent court hearing, FTX lawyer Andy Dietderich clarified that the company’s restructuring plans do not involve a relaunch, but rather focus on fully repaying customers. Despite extensive efforts, there are no plans to revive FTX.

FTX Users Demand Fair Treatment in Bankruptcy Proceedings

Numerous FTX users have requested a U.S. bankruptcy judge to prevent the collapsed crypto exchange from valuing their cryptocurrency deposits based on 2022 prices. They argue that this approach denies them the opportunity to benefit from the recent surge in crypto prices.

Some of the top 5 web 3.0 crypto projects, including VVS Crypto, WLuna Crypto, and WAX Crypto, have also expressed concern over FTX’s handling of the situation. As the web 3.0 movement gains momentum, the need for fair and transparent treatment of customers in the crypto industry becomes increasingly important.

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