FTX Liquidated Nearly $1 Billion in Grayscale Bitcoin Trust Shares, Report Indicates

The collapsed digital currency exchange FTX has disposed of shares estimated at nearly one billion dollars from Grayscale’s GBTC fund post the commencement of the fund’s trading as a direct bitcoin ETF, reports CoinDesk utilizing confidential information and unnamed sources.

Grayscale’s direct bitcoin ETF has overshadowed its competitors in trade volumes, largely derived from outflows. Data compiled by The Block from Yahoo Finance reveals that since the entrance of novel cryptocurrency-based ETFs into the market earlier in the month, Grayscale’s fund is responsible for roughly 54% of overall trade volume.

Senior ETF analyst at Bloomberg Intelligence, Eric Balchunas shared insights indicating that the fund has experienced a decline of $2.8 billion in value since initiation of trades.

The unloading of Grayscale ETF shares forms part of the ongoing liquidation efforts by FTX amidst bankruptcy, as recounted by CoinDesk. The liquidation included all 22 million Grayscale shares held by FTX’s bankruptcy estate, according to the news source’s report.

FTX Creditors Aim to Recover Losses

A Delaware bankruptcy tribunal authorized FTX Trading and its associated debtors to start offloading its Grayscale shares at the close of November. These shares, roughly 22 million of Grayscale’s principal bitcoin fund, were valued at about $597 million at the time.

FTX initiated bankruptcy filings in November 2022. The exchange’s creditors, which number amongst them individual clients, are seeking financial recovery through asset liquidation such as the Grayscale shares.

In the interim, bitcoin’s value slumped from close to $49,000, recorded at the time when the spot bitcoin ETFs started trading, to a figure below $41,000 as of 10:58 a.m. ET, based on data from The Block’s Price Page.

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