FTX cold wallet moved almost $10M in altcoins to Ethereum since Aug. 31

The cold wallet owned by the collapsing crypto exchange FTX moved nearly $10 million in altcoins from Solana to Ethereum since Aug. 31 for undisclosed reasons, according to on-chain data.

Altcoins include well-known tokens such as LINK, SUSHI, LUNA, and YFI. The transfer is carried out via the Wormhole Bridge.

It is unclear whether the transfer is related to the exchange’s bankruptcy proceedings or the recent request to hire Galaxy Digital to sell its crypto holdings for fiat.

FTX did not respond to a request for comment as of press time.

FTX wants to sell assets

FTX recently filed an application with bankruptcy court seeking permission to engage Galaxy Digital Capital Management as its fund manager for certain digital assets. The exchange also requests permission to stake some idle crypto assets to generate passive returns.

Under the proposed agreement, Galaxy will manage, trade, and convert FTX assets into fiat currency or stablecoins, and hedge collapsing exchange exposure to volatile cryptocurrencies in exchange for a monthly fiduciary fee.

FTX thinks Galaxy’s expertise in selling large cryptocurrency positions without impacting the market makes it a great choice. This engagement aims to support FTX’s restructuring efforts by monetizing its cryptocurrency holdings.

Additionally, the exchange has filed separate motions to establish guidelines for the management and sale of its digital assets and to enter into hedging arrangements for eligible cryptocurrencies – mainly Bitcoin and Ethereum.

Creditors criticize speed

FTX faced criticism from creditors for the slow pace of negotiating its bankruptcy plan.

Exchange attorney Brian Glueckstein rejected calls to expedite mediation at the most recent bankruptcy hearing on Aug. 23, saying the process would be completed in the second quarter of 2024.

The draft plan proposed by FTX on July 31 outlines an intention to repay customers through asset liquidations and insider litigation. However, tensions have risen over FTX’s efforts to find a buyer for its international exchange, FTX.com, and the lack of information being shared about incoming bids.

Creditors committee attorney, Kris Hansen, also highlighted the $50 million spent each month in attorneys’ fees and other costs due to FTX’s delays in resolving creditor issues. FTX is seeking to improve creditor recovery through lawsuits against its founder, Sam Bankman-Fried, investment firm K5, and the founders of FTX’s acquisition targets.

The bankruptcy case was filed in November 2022 following allegations that FTX misappropriated and lost billions of dollars in customers’ crypto deposits.