The judge allows FTX to sell its cryptocurrency assets, including BTC and SOL.

Shri333

A judge in the bankruptcy court of Delaware, USA, ruled on Wednesday that cryptocurrency exchange FTX can sell and invest its holdings of cryptocurrencies to repay creditors.

During the court hearing, Judge John Dorsey stated that he approved the motion and rejected two opposing opinions. This allows the bankrupt exchange to sell, collateralize, and hedge its holdings of cryptocurrencies, which are reportedly valued at over $3.4 billion.

A lawyer representing the Special Committee for FTX Customers supported the plan during the hearing, while a lawyer for the Unsecured Creditors Committee stated that all parties involved wanted to expedite the process.

"We are better off getting this started as soon as possible," he said.

FTX had submitted an application in August to participate in these activities, stating that hedging its cryptocurrency assets would "allow the debtor [FTX] to limit potential downside risk before selling such bitcoins or ether," and that "collateralizing certain digital assets" would "generate a low-risk return from idle digital assets, benefiting the remaining asset management entities and ultimately benefiting creditors."

The judge asked FTX officials if they could determine who deposited the assets.

"[FTX's] position is that the digital assets we are selling are assets of the debtor," the lawyer representing the exchange stated. Another lawyer stated that these assets are pooled and "cannot be traced to individual customers."

The exchange also requested the hiring of Mike Novogratz of Galaxy Digital as an advisor.

Earlier this week, FTX revealed that it holds approximately $1.16 billion worth of Solana (SOL), accounting for roughly 16% of the token's circulating supply, and approximately $560 million worth of Bitcoin (BTC). The remaining assets consist of relatively illiquid tokens.