The transfer of millions in altcoins has ignited concerns of FTX creating a potential dump across the crypto markets.
A wallet owned by bankrupt crypto exchange FTX has moved $10 million worth of digital assets from the Solana (SOL) network to Ethereum, sparking concerns it could be the beginning of a series of token dumps amid the exchange’s bankruptcy proceedings.
According to data from blockchain analytics platform Arkham Intelligence, since Aug. 31, the FTX wallet has transferred $6.23 million worth of Ether (ETH) and more than $4 million in altcoins.
These included $1.2 million of FTX Token (FTT), $1.8 million worth of Uniswap (UNI), $1.3 million of HXRO (HXRO), $550,000 worth of SushiSwap (SUSHI) and $260,000 worth of Frontier Token (FRONT), to another FTX wallet by way of the Wormhole Bridge.
FTX wallets on the move
Looks like they’re gearing up for potential sell-offs.
— Pump House (@pumphouz) September 3, 2023
On Aug. 24 FTX proposed a plan to appoint Mike Novogratz’s Galaxy Digital Capital Management as the investment manager charged with overseeing the sale and management of its recovered crypto holdings.
According to the plan, the FTX estate would only be permitted to sell $100 million of the tokens per week, however, that limit could be raised to $200 million on an individual token basis. These limits are intended to minimize the impact of token sales while simultaneously allowing FTX to make creditors whole.
In addition to this plan, the exchange also filed a separate motion to hedge its larger holdings of Bitcoin (BTC) and Ether.
While the propositions set forward in the filings are not yet legally binding, the case of FTX token sales is expected to come before the Delaware Bankruptcy Court on Sept. 13.
According to documents raised in the hearing, FTX held a total of $4.3 billion in crypto assets available for stakeholder recovery at market prices as of April 12.
The current reorganization plan for FTX includes a potential reboot of the cryptocurrency exchange, with FTX CEO John Ray III saying that the company had “begun the process of soliciting interested parties to the reboot of the FTX.com exchange.”
According to FTX lawyers, the launch of the new exchange is expected to be completed sometime in the second quarter of 2024.