FTX, the cryptocurrency exchange that hit a wall of bankruptcy, is now looking to offload its entire stake in Anthropic, an artificial intelligence firm, as per the latest court filings. This move is part of FTX’s broader efforts to liquidate assets under the supervision of the United States Bankruptcy Court for the District of Delaware. With this sale, the exchange aims to raise funds necessary to settle its debts, including those owed to customers who were left in the lurch following the exchange’s sudden collapse.
Dive Into the Details
The motion filed by FTX and its sibling, Alameda Research, highlights their intent to sell off Anthropic Series B Preferred Stock, a decision influenced by the chain of events leading to the exchange’s bankruptcy. Notably, FTX’s former CEO, Sam Bankman-Fried, had channeled approximately $530 million into Anthropic back in April 2022, utilizing funds that, according to court proceedings, were sourced from customer deposits. This investment, made months before FTX’s implosion in November 2022, underscored the risky financial maneuvers that ultimately contributed to the exchange’s downfall.
At the time of its Series B funding round, Alameda Research secured a 13.56% stake in Anthropic. However, subsequent funding rounds diluted this stake to 7.84%, despite the AI firm’s valuation soaring to $18 billion by December. This valuation pegs Alameda’s share at an estimated $1.4 billion, making the stake a significant asset in FTX’s bankruptcy estate.
The filing also requests the court to fast-track the review of its sale motion, aiming for a decision by February 22. The rationale behind seeking a speedy sale process is to maximize returns from the liquidation of its Anthropic shares, which could potentially attract interest from various quarters, including participants in Anthropic’s recent financing rounds.
FTX’s Financial Recovery Strategy
This push to sell Anthropic shares is one of several actions taken by FTX’s new management to salvage value from the wreckage of Bankman-Fried’s empire. In addition to this proposed sale, the exchange has sought court approval to sell a $175 million claim against Genesis Global Capital, another entity that found itself in financial hot water. The claim sale against Genesis, if approved, would be executed under conditions designed to ensure the best possible return, reflecting FTX’s pragmatic approach to asset liquidation.
The backdrop to these asset sales is FTX’s ongoing bankruptcy proceedings, where the company has been clear about its priorities: repaying creditors and customers. Despite optimistic statements from FTX’s legal team about the possibility of making full restitution, the company has distanced itself from the idea of relaunching the exchange. Instead, the focus remains squarely on asset liquidation as a means to meet its obligations to those affected by its collapse.
FTX’s fall from grace was not just a shock to its customers but also sent ripples through the cryptocurrency market, raising questions about the oversight and risk management practices within the industry. The proposed sale of its Anthropic stake, alongside other assets, is a critical step in the bankruptcy process, offering a path towards financial resolution for the embattled exchange. In essence, FTX’s current trajectory is not about reinvention but restitution.
