FTX to Sell LedgerX Exchange for $50 Million Amid Bankruptcy Recovery

FTX, a cryptocurrency derivatives exchange, has announced plans to sell the LedgerX exchange for $50 million in a bankruptcy recovery effort. The move is aimed at helping LedgerX, a regulated Bitcoin options exchange, to restructure and regain its financial stability. LedgerX has been going through a bankruptcy process since last year, hindered by the effect of the COVID-19 pandemic on the crypto industry. FTX, which has grown rapidly in recent years, hopes to acquire LedgerX and use its proprietary technology to expand its own offerings. The sale is subject to approval by the US Commodity Futures Trading Commission.

FTX, once a crypto giant, filed for bankruptcy after incurring a debt of over $3 billion. However, the company’s efforts to bounce back have not gone unnoticed. Despite scrutiny by US regulators, FTX continues to receive offers from companies that could help it recover from bankruptcy, or at least pay its creditors.

One such company is Miami International Holdings (MIAX Technologies), whose subsidiary has agreed to purchase LedgerX, a futures and options exchange licensed in the US and regulated by the CFTC. The purchase agreement, whose completion is subject to certain regulatory obligations and the absence of objections from the CFTC, will allow MIAX to take control of all membership interests issued and pending by LedgerX.

According to John J. Ray III, Chief Executive Officer and Chief Restructuring Officer of the FTX Debtors, the sale of one of FTX’s US subsidiaries will contribute to the monetization of the bankrupt exchange, thereby meeting client obligations. FTX debtors will receive approximately $50 million from M7 Holdings, the MIH subsidiary that won the LedgerX auction held on April 4 by the US Court.

LedgerX remained solvent throughout FTX scrutiny, and Judge John Dorsey authorized the sale of the derivatives platform, as well as other Japanese and European subsidiaries, during a presentation in the US Bankruptcy Court in early January 2023. Since then, FTX had received at least 117 offers from various interested bidders to purchase the exchange’s assets.

FTX, under new administration, is doing everything possible to secure as much money as possible in order to repay its creditors. The sale of LedgerX is just one of a series of deals that FTX has been able to conclude. It remains to be seen if these efforts will yield the desired outcome.

In conclusion, FTX’s sale of LedgerX to MIAX is a positive step forward in the exchange’s efforts to recover from bankruptcy and meet its client obligations. However, only time will tell if these efforts will bear fruit.

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