Coin Edition -
- FTX decides to sell Digital Custody Inc. to CoinList at a discount of 95% for just 500,000.
- The company acquired DCI in two transactions in 2021 and 2022, each valued at $5 million.
- As the company dropped its plans to reboot FTX.US, it decided to sell DCI, which held minimal value as an asset.
In a recent filing, the FTX Debtors’ estate, under the leadership of CEO John Ray III, announced its decision to sell Digital Custody Inc. (DCI) to the centralized exchange (CEX), CoinList. In a bid to repay debts amidst increasing pressure from creditors and regulators, FTX has filed to sell the $10 million subsidiary at a massive discount of 95% for just $500,000.
According to the filing, FTX acquired DCI, a trust company registered in South Dakota, for a total amount of $10,000,000. While FTX envisioned providing custodial services for cryptocurrencies and other digital property for FTX US and LedgerX, the company purchased the subsidiary in two major transactions. On December 21, 2021, FTX entered into an agreement spending $5 million, and later, on August 6, 2022, the company acquired DCI with another $5 million.
In a recent revelation, FTX unveiled the abandonment of its plans to relaunch FTX, concentrating fully on customer fund reimbursement. Though the platform previously intended to reboot FTX as FTX.com, its inability to find sufficient investment for the launch forced them to drop the plan.
With no plans to revive FTX.US, DCI held minimal value as an asset, which led to the platform’s decision to liquidate it. The filing stated, “DCI is also no longer useful to the Debtors’ business given the Debtors’ sale of LedgerX and that it is unlikely for the Debtors to sell or restart FTX US.”
Notably, FTX received offers from three interested parties for the sale of DCI, including its former CEO, Terence J. Culver, the company chose the purchaser based on their ability to expedite the transition. In addition, the filing stated that the purchaser would obtain financing for the sale and the related operations “in the form of a convertible note” from Culver.
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