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Bankrupt digital currency trading firm FTX Derivatives Exchange, through its sister trading firm, Alameda Research, has filed a lawsuit against Grayscale Investment. The case was filed in the Court of Chancery in the State of Delaware, and it names its CEO, Michael Sonnenshein, and the parent company, Digital Currency Group, as defendants.
According to the suit, FTX wants injunctive relief to unlock $9 billion or more in value for shareholders of the Grayscale Bitcoin and Ethereum trusts. Should this request be granted, it will unlock the sum of $250 million for FTX, which the firm can add to its pot of funds to repay its own creditors.
Grayscale operates the largest trusts in the digital currency ecosystem, with Grayscale Bitcoin Trust (GBTC) topping over $14 billion in assets under management (AUM) as of the time of writing. GBTC has lost more than 44% of its value over the trailing 12-month period, and should the request be granted, FTX may still have to endure some losses.
Besides releasing the said sum, FTX also wants the court to compel Grayscale to stop charging its exorbitant management fees, which have topped $1.3 billion in just two years.
FTX is desperate for funds
Suing Grayscale is not a surprise as FTX has been exploring a whole lot of avenues to free up funds in order to repay its creditors. With more than $8 billion in assets belonging to investors, FTX has earlier promised to file lawsuits in cases where it will help it meet its goals in the short- to midterm.
While still the golden boy of crypto, the company's founder and former CEO Sam Bankman-Fried made a lot of donations to political parties and charities. The company has revealed its plans, including the possibility of a lawsuit to claw back these funds.
Tomiwabold Olajide
