FTX to hire Galaxy Digital to sell assets

The collapsed FTX told the court about plans to “sale, staking and hedging” of its $3 billion of digital assets — and will hire Galaxy Digital, Mike Novogratz’s firm, to do so.

In bankruptcy proceedings, the platform wants to return creditors’ funds in fiat after selling the cryptocurrencies. FTX believes that careful trading could help avoid a decline in asset value.

“Hedging will allow the debtors to limit potential declines in the value before selling bitcoin or Ethereum. Placing certain digital assets in staking will ultimately benefit creditors by generating low-risk income,” said the company’s lawyers.

Additionally, the exchange hopes to generate additional profits from the trades to settle with clients.

FTX chose Galaxy, citing the firm’s “extensive experience in digital asset management and investment trading.” In turn, Novogratz’s company, in addition to standard payment, will receive “a hedging and liquidation fee.”

According to CoinDesk, FTX spends about $1.5 million daily on legal services.

“Now the lawyers’ fees have reached almost $50 million a month. Literally hundreds of lawyers, financial advisers and bankers are working with them almost full-time. Every dollar spent on this case is essentially a dollar that clients will not receive,” said creditor spokesperson Chris Hansen.

In June, the current FTX management team said it had returned liquid assets worth about $7 billion.

In May the exchange filed a suit against Genesis demanding to return $3.9 billion. Subsequently the amount of claims was reduced to $2 billion. Ultimately the companies agreed to pay $175 million to Alameda Research.