The court has approved the sale of LedgerX to FTX for $50 million.
A US court has given the green light for FTX’s sale of the struggling derivatives trading platform LedgerX to a private equity firm M7 Holdings for $50 million, despite FTX’s losses. The approval was granted swiftly by Judge John Dorsey on Thursday.
The United States Bankruptcy Court in Delaware has approved the motion to sell LedgerX by FTX. CEO Zach Dexter announced the news on Twitter, expressing his delight. However, this sale adds to the series of embarrassing incidents that have affected FTX since it acquired the derivatives exchange LedgerX for approximately $300 million in August 2021.
Last August, Sam Bankman-Fried, who was then the CEO of FTX, expressed his excitement for the purchase of LedgerX, stating that providing derivatives to American clients was a significant accomplishment for the FTX brand.
The approved sale of LedgerX by FTX for $50 million is $250 million less than the original purchase price. The sale aims to compensate former customers who lost money following FTX’s collapse. Despite FTX’s bankruptcy, LedgerX remained financially stable as a CFTC-regulated trading platform.
The ex-CEO and co-founder of the crypto exchange, was seen in advertisements across San Francisco giving donations to both the Republican and Democratic parties. This gave the impression that he was on good terms with the political establishment.
The exchange, which was once financially stable, collapsed without warning in November 2021. According to federal prosecutors, the exchange’s former CEO and co-founder, Sam Bankman-Fried, mishandled the company and is now facing 13 charges, including wire fraud and money laundering conspiracy.
