Alameda Research, the cryptocurrency trading firm affiliated to bankrupt
digital exchange FTX, has filed a lawsuit against crypto asset manager
Grayscale, FTX said in a statement. The once-leading crypto exchange alongside
other affiliated debtors are seeking to “realize over a quarter billion dollars
in asset value for FTX Debtors’ customers and creditors.”
They are also asking for an injunctive relief to unlock $9 billion or
more in value for shareholders of the Grayscale Bitcoin and Ethereum Trusts. These
trust funds track the price of Bitcoin and Ether.
The development comes a month after the Digital Currency Group (DCG), a digital asset conglomerate and the parent company of Grayscale, started selling the crypto asset manager’s holdings in several investment vehicles at a steep discount to raise capital for its bankrupt lending business.
In the statement released on Monday, FTX alleged that Grayscale over the
last two years has charged over $1.3 billion in exorbitant management fees,
thereby contravening the agreement of its trust funds. The struggling
cryptocurrency exchange also alleged that Grayscale for years has been
preventing shareholders from redeeming their shares by making “contrived
excuses.” As a result of these developments, FTX noted in the statement, the
Grayscale Bitcoin and Ethereum Trusts’ shares now trades approximately 50%
lower compared to its daily net asset value.
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“We will continue to use every tool we can to maximize recoveries for
FTX customers and creditors. Our goal is to unlock value that we believe is
currently being suppressed by Grayscale’s self-dealing and improper redemption
ban,” John J. Ray III, FTX’s new CEO and Chief Restructuring Officer, said in
the statement.
Furthermore, FTX in the statement noted that its customers’ shares would
be worth approximately 90% more, that is at least $550 million, if Grayscale
cut down its fees and halted “improperly preventing redemptions.”
Meanwhile, Reuters reported on Tuesday that the District of Columbia
Court of Appeals in Washington today will hear Graysacle’s case against
the United States Securites and Exchange Commission (SEC) for throwing out its
application to launch a spot Bitcoin (BTC) exchange-traded fund (ETF ).
The outlet noted that the crypto asset manager’s legal team are set to
argue that the SEC acted arbitrarily by turning down the firm’s application
when it had previously sanctioned BTC futures EFTs.
The SEC currently opposes the offering of cryptocurrency products to
United States citizens, categorizing them as securities. The securities
regulator is currently at loggerheads with companies such as Ripple, Robinhood and Terraform Labs.
Alameda Research, the cryptocurrency trading firm affiliated to bankrupt
digital exchange FTX, has filed a lawsuit against crypto asset manager
Grayscale, FTX said in a statement. The once-leading crypto exchange alongside
other affiliated debtors are seeking to “realize over a quarter billion dollars
in asset value for FTX Debtors’ customers and creditors.”
They are also asking for an injunctive relief to unlock $9 billion or
more in value for shareholders of the Grayscale Bitcoin and Ethereum Trusts. These
trust funds track the price of Bitcoin and Ether.
The development comes a month after the Digital Currency Group (DCG), a digital asset conglomerate and the parent company of Grayscale, started selling the crypto asset manager’s holdings in several investment vehicles at a steep discount to raise capital for its bankrupt lending business.
In the statement released on Monday, FTX alleged that Grayscale over the
last two years has charged over $1.3 billion in exorbitant management fees,
thereby contravening the agreement of its trust funds. The struggling
cryptocurrency exchange also alleged that Grayscale for years has been
preventing shareholders from redeeming their shares by making “contrived
excuses.” As a result of these developments, FTX noted in the statement, the
Grayscale Bitcoin and Ethereum Trusts’ shares now trades approximately 50%
lower compared to its daily net asset value.
Keep Reading
“We will continue to use every tool we can to maximize recoveries for
FTX customers and creditors. Our goal is to unlock value that we believe is
currently being suppressed by Grayscale’s self-dealing and improper redemption
ban,” John J. Ray III, FTX’s new CEO and Chief Restructuring Officer, said in
the statement.
Furthermore, FTX in the statement noted that its customers’ shares would
be worth approximately 90% more, that is at least $550 million, if Grayscale
cut down its fees and halted “improperly preventing redemptions.”
Meanwhile, Reuters reported on Tuesday that the District of Columbia
Court of Appeals in Washington today will hear Graysacle’s case against
the United States Securites and Exchange Commission (SEC) for throwing out its
application to launch a spot Bitcoin (BTC) exchange-traded fund (ETF ).
The outlet noted that the crypto asset manager’s legal team are set to
argue that the SEC acted arbitrarily by turning down the firm’s application
when it had previously sanctioned BTC futures EFTs.
The SEC currently opposes the offering of cryptocurrency products to
United States citizens, categorizing them as securities. The securities
regulator is currently at loggerheads with companies such as Ripple, Robinhood and Terraform Labs.
