The FTX estate recently concluded the sale of its heavily discounted Solana (SOL) tokens to Pantera Capital and Figure Markets in an effort to reimburse creditors and former clients. The tokens, valued at $2.6 billion, were sold at a significantly reduced price of $102 per token, well below the market price of $168. This sale marks a significant step in the estate’s recovery efforts, as it has already managed to recover $7.3 billion in assets so far.
Despite the estate’s efforts to compensate creditors and former clients, the decision to sell the assets at such deep discounts has not been without controversy. Sunil Kavuri, a creditor leading the FTX creditor community, criticized the sale, arguing that the digital assets should have been returned directly to the creditors and clients instead of being sold cheaply. Kavuri’s sentiments echo the frustrations of many affected by the FTX collapse, who have been critical of the actions taken by the estate’s bankruptcy lawyers, Sullivan & Cromwell.
An independent investigation into Sullivan & Cromwell’s role in the bankruptcy proceedings was ordered by the court, ultimately clearing them of collusion with FTX. However, criticisms persist regarding the handling of asset sales. Additionally, a report by Robert Cleary revealed that FTX Group allegedly paid over $25 million in hush money to seven whistleblowers before the exchange’s collapse. The settlements, ranging from $1.8 million to $16 million, were intended to address concerns about various improprieties and misleading regulators.
Former FTX executive Ryan Salame is facing a 5-to-7-year sentence for campaign finance violations and operating an illegal money-transmitting business during his tenure as the CEO of FTX’s Bahamian subsidiary. Prosecutors argue that his offenses are significant and involve more than $1 billion in unlicensed transactions. Additionally, the UK government’s Charity Commission investigation found that Effective Ventures Foundation, an FTX-funded charity, acted diligently to protect its funds after FTX’s collapse. The charity repaid $4.3 million to the FTX estate and disclosed its connections to the exchange, prompting a regulatory probe.
The auction of discounted Solana tokens by the FTX estate has sparked controversy and criticism from creditors and former clients. The decision to sell the assets at deep discounts has been met with skepticism, as many believe that the digital assets should have been returned directly to those affected by the FTX collapse. The ongoing legal troubles and investigations surrounding the bankruptcy proceedings further complicate the situation, raising questions about the estate’s handling of asset sales and financial dealings.
