several events FTX’s bankruptcy proceedings continue to unravel as the cryptocurrency exchange seeks to resolve its creditors, and could restart. The latest news is that the company has taken action to protect its remaining assets with the help of: Galaxy Digital.
FTX seeks to protect crypto assets
according to a archive Date August 24, Cryptocurrency Exchange Fortis A motion has been filed seeking court approval of its investment services agreement with Galaxy Digital.
The motion, titled “Token Administration and Monetization Motion,” states that the debtor’s board of directors has selected Galaxy Asset Management to provide investment management services for the digital assets that make up the firm’s accounts.
This is part of the company’s plan to hedge against the volatility of its digital assets while finalizing plans to repay creditors and customers.
It also aims to profit from the venture, likely to shore up its liquidity and further provide the means to fully offset its debt.
However, such hedging and pledge arrangements must be made under “court-approved management and monetization guidelines,” which is why it filed the motion.
FTT Token price falls below $1 | Source: FTTBUSD on Tradingview.com
terms of agreement
If the court approves the investment services agreement, Galaxy Digital will provide certain services to the bankrupt cryptocurrency exchange, including managing its assets.
The investment manager will use FTX’s account to trade “any and all financial instruments,” including digital assets, futures contracts, commodities, and other similar investment funds.
In addition, Galaxy Digital will provide certain “support services” to the account, such as administrative and accounting services. It will select brokers and dealers, banks and other transaction intermediaries.
Under the agreement, it will also enter into and execute the agreement, make payments on behalf of the account, and perform its duties as investment manager.
A notable highlight of the agreement is a “best execution” obligation, which means Galaxy Digital must “seek and obtain the best terms reasonably available” when executing transactions on behalf of accounts.
This is in addition to the investment manager’s fiduciary duty to act with due care and in the best interest of the client. At the same time, FTX’s obligation will be to pay Galaxy Digital management fees and any other fees stipulated in the agreement.
It is worth mentioning that the agreement will only come into effect after the monetization and approval order is issued by the court. If the court fails to approve the agreement in “all material respects,” Galaxy Digital has the right to refuse to provide services to FTX.
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