FTX is making major shifts in its digital asset holdings.
The cryptocurrency community is abuzz after a wallet linked to the bankrupt crypto exchange FTX recently moved $10 million worth of digital assets from the Solana network to Ethereum. This activity raised concerns about the possibility of a flood of token dumps as FTX moves through its bankruptcy.
According to Arkham Intelligence, a blockchain analytics firm, the FTX wallet shifted $6.23 million in Ether (ETH) and more than $4 million in various altcoins since August 31st.
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Among these were over $1 million of FTX Token (FTT), Uniswap (UNI) and HXRO tokens, $550,000 in SushiSwap (SUSHI), as well as $260,000 in Frontier Token (FRONT). Based on the on-chain data, the bankrupt crypto exchange used the Wormhole Bridge to move these assets to another FTX wallet.
FTX had earlier proposed to appoint Galaxy Digital Capital Management, led by Mike Novogratz, to oversee the sale and management of its recovered crypto assets. The plan restricts token sales to $100 million per week but allows increasing the cap to $200 million for individual tokens.
FTX also filed a motion to hedge its more significant Bitcoin (BTC) and Ether holdings. It is believed that the Delaware Bankruptcy Court will review all proposals on September 13th.
It is worth noting that in June, FTX revealed that it had recovered over $7 billion in liquid assets, with almost $5 billion recovered as of November 2022. As of the same date, the crypto exchange had $4.3 billion in crypto assets available for recovery.
The movement of $10 million in digital assets has undeniably jolted the crypto investing world, further complicated by FTX's ongoing bankruptcy proceedings. While the court's decision on September 13th will shed more light on the situation, stakeholders are wary of what these transfers might mean for the broader crypto market.
