By Gabriel Joyce
In order to settle debts, the FTX bankruptcy estate has finalized its asset liquidation strategy by selling its remaining shares in AI startup Anthropic for $450 million, marking a significant step towards reimbursing the defunct exchange’s former customers.
Massive Sale Completes FTX Liquidation Effort
FTX has successfully capitalized on its investment in Anthropic by offloading its final batch of shares in the AI firm for an impressive $452 million. This sale involved 15 million shares priced at $30 each, with the venture capital fund G Squared securing about one-third of these shares for approximately $135 million.
Alongside G Squared, Fund FG-BLU and various other hedge funds and investment entities participated in the purchase, collectively advancing the bankruptcy estate’s efforts to repay creditors and restore funds to FTX’s former users.
This transaction is a continuation of FTX’s liquidation strategy, following a previous sale two months prior that fetched around $900 million from similar share disposals at the same price per share.
Altogether, the sale of FTX’s holdings in Anthropic has accumulated roughly $1.3 billion, a significant boost to the estate’s financial recovery initiatives.
Strategic Investments Yield Substantial Returns
FTX’s foray into the AI sector in 2021 proved to be highly lucrative. Initially, the exchange, along with its affiliate Alameda, invested $500 million to secure an 8% stake in Anthropic.
This investment significantly appreciated in value due to the booming interest and advancements in the AI industry, ultimately netting the exchange a profit exceeding $800 million.
This financial gain from the Anthropic shares is part of a broader strategy by the FTX bankruptcy estate to maximize returns for creditors. Beyond the tech sector, the estate has also begun to liquidate real estate assets acquired before the exchange’s collapse.
These efforts reflect a comprehensive approach to resolving the financial obligations of the now-defunct platform and restoring trust among its stakeholders.
Soaring Costs of Bankruptcy Management
The financial toll of managing FTX’s bankruptcy has been substantial, with total costs now exceeding $700 million. These expenses encompass a range of legal and administrative fees incurred since the exchange’s downfall.
The consulting firm Alvarez & Marsal tops the list of creditors, having billed the estate a staggering $212 million for their advisory services. Close behind is Sullivan and Cromwell, the legal firm representing FTX, with fees amounting to $202 million.
An additional notable expenditure includes the compensation for FTX CEO John Ray, who has billed $5.6 million for his role in navigating the bankruptcy proceedings at an hourly rate of $1,300. These high costs highlight the complex and costly nature of disentangling the financial and legal challenges faced by the defunct cryptocurrency exchange.
