FTX Trading Ltd., accompanied by its linked debtors, has approached the U.S. Bankruptcy Court in Delaware with a proposal to collaborate with Michael Novogratz's Galaxy Digital Capital Management LP, also known as Galaxy Asset Management.
FTX Trading Proposes Alliance With Novogratz's Galaxy Digital
FTX aims to onboard Galaxy Asset Management to oversee a portion of its crypto holdings. Debtors insist with Galaxy's deep-rooted expertise in the digital asset realm, the bankrupt entity and its debtors deem the firm perfectly suited for the role.
Under this potential partnership, Galaxy's responsibilities would encompass managing FTX's digital assets, furnishing strategic counsel, executing trades, and adeptly maneuvering to prevent adverse price fluctuations from bulk asset sales. Additionally, the firm intends to optimize the value derived from sales by hedging these crypto assets.
For their services, Galaxy would earn a remuneration structured as management fees, derived from the assets' value and revenue from asset sales. The proposal also stipulates provisions for expense coverage and mutual safeguard clauses. FTX asserts that the anticipated compensation aligns seamlessly with the projected service deliverables.
Interestingly, Galaxy isn't just an external party; they're also a creditor to FTX with a staggering $76 million tied up with the now-obsolete exchange. As a result, FTX, along with its debtors, seeks the court's green light to formalize the investment service accord under sections 105(a) and 363(b) of the Bankruptcy Code.
FTX is confident that this partnership with Galaxy exemplifies its sound business acumen. It is perceived as a pivotal move to both safeguard and amplify the worth of its digital assets amidst the ongoing bankruptcy ordeal.
"Galaxy Asset Management has extensive experience in areas relevant to digital asset management and trading, including with respect to the types of transactions and investment objectives contemplated," the court documentation underscores.
What do you think about FTX attempting to partner with Galaxy for funds management? Share your thoughts and opinions about this subject in the comments section below.
Source: Bitcoin.com
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