FTX Cold Wallet Transfers Nearly $10 Million in Altcoins to Ethereum Since August 31st

By 0xGorki 09/3/23 12:42 AM

A cold wallet owned by the now-collapsed cryptocurrency exchange FTX has reportedly moved a substantial sum of nearly $10 million in altcoins from the Solana blockchain to Ethereum since August 31, 2023. This intriguing development, revealed through on-chain data, has raised several questions about the motives and implications behind the transfer.

The transferred altcoins include some of the most notable tokens in the crypto space, such as Chainlink (LINK), SushiSwap (SUSHI), Terra (LUNA), and Yearn Finance (YFI). What adds to the intrigue is that these transfers were executed through the Wormhole Bridge, a cross-chain protocol that allows assets to move seamlessly between different blockchain networks.

The most significant mystery shrouding these transfers is the undisclosed reasons behind them. It remains unclear whether these movements are in any way connected to FTX’s ongoing bankruptcy proceedings or its recent request to enlist the services of Galaxy Digital Capital Management to liquidate its crypto holdings for fiat currency.

As of the time of this report, FTX has remained tight-lipped and has not issued any official statement or response regarding these puzzling transfers. The lack of communication from the exchange has only fueled speculation within the cryptocurrency community.

FTX’s quest to sell assets and restructure

FTX’s recent bankruptcy filing has been a subject of significant attention within the crypto space. The exchange filed a request with the bankruptcy court, seeking permission to engage Galaxy Digital Capital Management as its investment manager for certain digital assets. This move is part of FTX’s broader efforts to navigate through its financial troubles.

Under the proposed agreement, Galaxy Digital would take charge of managing, trading, and converting FTX’s assets into fiat currency or stablecoins. Moreover, the investment manager would help hedge the exchange’s exposure to volatile cryptocurrencies, all in exchange for a monthly fiduciary fee.

FTX has argued that Galaxy Digital’s expertise in handling the sale of large cryptocurrency positions without causing market disruptions makes it a suitable choice to assist in the restructuring process. This engagement with Galaxy Digital aims to support FTX’s efforts to monetize its cryptocurrency holdings, a crucial step in resolving its financial woes.

In addition to seeking Galaxy Digital’s assistance, FTX has filed a separate motion to establish guidelines for managing and selling its digital assets. These guidelines would also cover hedging arrangements, primarily focused on cryptocurrencies like Bitcoin and Ethereum. This dual-pronged approach underscores FTX’s commitment to efficiently handle its digital asset portfolio as it grapples with the aftermath of its collapse.

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