The bankrupt cryptocurrency exchange FTX is currently seeking approval to sell its 8% stake in the AI startup Anthropic Holdings. The request, filed by FTX’s current CEO, John Ray III, outlines two potential sale methods: an auction or a private sale.
In an effort to expedite the decision-making process, FTX is asking for a shortened objection period, with a court hearing slated for February 22. The exact price at which FTX intends to sell its Anthropic shares has been kept confidential in the filing, with FTX’s legal team asserting that public disclosure might hinder the chance of obtaining higher offers for the stake.
In December 2023, Anthropic Holdings achieved an estimated valuation of up to $18 billion, suggesting that FTX’s 7.84% stake could be worth approximately $1.4 billion. This valuation has given hope to victims of the FTX collapse, as FTX believes it may have enough funds to fully satisfy all customer and creditor claims.
The sale of the Anthropic Holdings stake represents a significant opportunity for FTX to generate funds and meet its financial obligations. By divesting this illiquid asset, FTX aims to maximize returns for its stakeholders and fulfill its commitments to customers and creditors.
FTX Files Motion to Sell its Claim Against Genesis
Earlier this month, FTX filed a motion in a Delaware court, seeking permission to sell its $175 million claim against the bankrupt digital financial services firm, Genesis Global Capital. This claim was originally asserted by Alameda Research, which is an associated hedge fund of FTX.
If the motion is approved, FTX will have the flexibility to sell the claim either in its entirety or in smaller portions, allowing it to take advantage of the most favorable market conditions. Currently, claims against Genesis are being sold for 65% of their face value, a significant increase compared to the 38% that Alameda Research claims they are fetching.
The motion aims to establish a standardized sales procedure that would apply to all transactions, streamlining the process and reducing associated costs. According to this procedure, the sale price must be at least 95% of the highest price quoted by leading market-makers for general unsecured claims of Genesis Global Capital within three days of the sale date.
FTX originally sought to recover $3.9 billion from Genesis in May 2023 but later negotiated a reduced claim of $175 million in August 2023, which was subsequently approved by the court in October. This decision was driven by the unpredictability of potential recoveries and a desire to avoid lengthy and costly litigation.
Genesis Had $175M in FTX Accounts
FTX encountered significant difficulties when irregularities were uncovered in its accounting records, ultimately leading to its collapse in November 2022.
During that period, Genesis had $175 million tied up in FTX accounts, although it asserted that this did not impact its market-making activities.
Genesis, which is a subsidiary of the Digital Currency Group, filed for bankruptcy in January 2023. This move triggered a contentious dispute with the Gemini cryptocurrency exchange regarding the implications for the Gemini Earn program.
In a separate development, Genesis recently reached a $21 million settlement with the United States Securities and Exchange Commission concerning the Gemini Earn program. This settlement will be assessed during a court hearing in New York scheduled for February 14. During the same hearing, Genesis debtors’ proposed bankruptcy reorganization plan will also be reviewed.