The bankrupt cryptocurrency exchange, FTX, is willing to start selling, staking, and hedging its crypto holdings and is seeking Mike Novagratz’s Galaxy Digital to help manage them.
FTX submitted court filings that seek permission to work with Galaxy Asset Management, saying “provide investment manager services with respect to certain digital assets that constitute an account of FTX Trading.”
FTX collapsed in November last year; however, it wants to give back funds to the creditors in fiat currency instead of in Bitcoin or Ether. FTX also hopes for careful trading that can avoid denting the value of over $3 billion in cryptocurrency holdings.
The exchange operator, John Ray III, worries that the price would drop if everything was sold at once. He also noted Galaxy’s experience in crypto industry and said it is “well-qualified and able to provide digital asset management and trading services in a cost-effective, efficient and timely manner.”
“Galaxy Asset Management has extensive experience in areas relevant to digital asset management and trading, including with respect to the types of transactions and investment objectives contemplated,” the document said, referring to the SEC-approved investment advisor.
FTX listed a number of services it hopes Galaxy will offer in the filing, including the ability to buy, sell, swap, redeem, manage, stake, hold, exchange, convert, and trade a variety of financial instruments, including cryptocurrencies.
FTX would not only reimburse Galaxy for specific expenses but would also pay a “hedging fee” and a “liquidation fee” to the company, as per agreement.