By Norah ODonnell
On April 18, Tribe Capital announced plans to restore the operation of the Bahamian crypto exchange FTX. The venture capital is seeking to launch a $250 million funding round for the projects. The announcement revealed that Tribe Capital budgets to generate $100 million from their revenue and support from key stakeholders.
Subsequently, a source privy to the matter revealed that the co-founder of the San Francisco venture capital Arjun Sethi presented this proposal to the FTX unsecured creditors at the beginning of this trading year. Sethi’s proposal captured over 9 million FTX user accounts from the US, Australia and Japan.
Proposed FTX Restructuring Plan
The January report discussed the operation of FTX International and the LedgerX platform. Sethi failed to expound on FTX’s venture capital platform and other crypto-related products and services in the proposal. However, Sethi suggested retaining the FTX brand name after restructuring.
Reportedly, Tribe Capital was established in 2018 and was listed as an FTX international investor. Situated in the US, the Tribe team was also considered an FTX American customer.
As of this writing, the Tribe manages assets worth $1.6 billion. Also, the company has provided technological, human and financial support to leading crypto firms, including Kraken, Shiprocket and Bolt payment platforms.
Therefore, ranking as a stakeholder of FTX, the crypto exchange opted to support Sethi’s proposal. The Committee of Unsecured Creditors tweeted on April 18, revealing plans to engage debtors to explore practical strategies to restore the operation of FTX.
The tweet encourages the community to support the firm in its rebooting efforts. Speaking at a court proceeding, the FTX team projected to assume operation in next year’s Q2.
Meanwhile, due to the ongoing regulatory crackdown in the US FTX committee is yet to announce when to resume operation.
Review of FTX Court Proceedings
Beyond this, FTX chief executive John J. Ray III plans to conduct a feasibility study to examine whether the recovery effort will bear the desired outcomes. In a previous address from FTX’s counsel Andrew G. Dietderich, he regretted that the reorganization of FTX would require substantial money.
Dietderich confessed that FTX was still at its early growth stage and that raising huge capital might require sourcing for external financing from investors.
Nevertheless, the review of a recent court ruling allowed the crypto exchange to auction Ledger X and stock exchange platforms operating in Japan and Europe to repay the creditors. A valuation made by the legislators revealed that the value of four FTX’s assets on sale was depreciating.
The decline in value of assets obliged the court to task the American financial provider Perella Weinberg to proceed in executing the FTX sale plan. The court decision has attracted more than 177 investors planning to purchase FTX assets.
In February, the FTX lawyer submitted a monthly fee report to the court as instructed. The lawyer observed that the prosecutors were assessing past FTX activities, including an earlier engagement with Sygnia Inc., which provided the crypto exchange with a security solution. The regulators were also evaluating the FTX user experiences.
Elsewhere, a submission made by Sullivan & Cromwell on April 12 revealed that the crypto exchange liquidity assets generated $7.3 billion.
Following the Tribe Capital announcement, the price of FTX native token FTT has surged by 16.55% to trade at $2.09. According to CoinMarketCap, FTT failed to break the resistance level at $2.28 in the last 24 hours.
Correspondingly, at press time 02:36 UTC, the FTT found support at the $ 1.79 level. The trading volume and market capitalization increased by 347.34% and 15.71% over the last 24 hours.