On Thursday, March 23, creditors of the defunct cryptocurrency exchange FTX submitted a petition to the bankruptcy court requesting a 95 million dollar share in the Web3 company Mysten Labs, based in Delaware.
The cryptocurrency trading platform FTX has managed to stay afloat to make good on its promise to compensate consumers who were adversely affected by the exchange’s bankruptcy in November 2022.
Before it collapsed, FTX had paid $101 million for the preferred stock of Mysten Labs the previous year and also led a funding round that valued the Web3 company at more than $2 billion. These transactions occurred before the company went bankrupt.
Mysten Labs is a blockchain platform that operates on an open-source programming language known as Move, and its native cryptocurrency is known as SUI tokens.
The platform uses the Proof-of-Stake consensus mechanism. The Q2 of 2023 is scheduled to mark the beginning of the complete introduction of the Web3 platform.
The creditors of FTX delivered their files to the US Bankruptcy Court of Delaware on March 22. Per the terms of the arrangement, the debtors will sell back to Mysten Labs about $95 million worth of preferred stock in addition to $1 million worth of SUI tokens. In the filing (1), it says:
“The Borrowers carefully examined and evaluated the offer as set out in the Contract in contrast to its other choices and came to the conclusion that a sale of the Interests will lead to getting optimal worth for the Interests, is in the best interests of the Debtors and creditors. “
The Purchase Price is roughly 95% of the amount that FTX Ventures had initially invested in the Preferred Stock of the Purchaser-Subject Business, plus 100% of the price that Sellers spent for the SUI Token Warrants.
Transaction Dependent Upon the Permission of the Court
The sale of FTX’s investment in Mysten Laboratories will, however, be contingent on the consent of the court. In accordance with the motion, Mysten Labs submitted an offer to reclaim FTX’s interest on March 16 this past week.
It was discovered that this was an “attractive offer that would allow the Debtors to recoup a large amount of the money that the Debtors invested” through FTX. This was discovered to be the case.
On the other hand, the deal was only valid until the end of April. Mysten Laboratories informed FTX of its “desire to close a transaction promptly” in a different letter of communication sent to FTX separately.
In their court filing on March 22, the debtors involved in the FTX case revealed that they intend to pursue the venture capital company Modulo Capital for the recovery of user cash totaling 460 million dollars.
In addition, the petition asserts that the transaction from Alameda Research was made under the instruction of Sam Bankman-Fried, who served as CEO of FTX in the past, and that monies were improperly appropriated.