FTX Estate Sells $232M in Locked Solana Tokens, Attracting Investors and Reducing Debt

The FTX estate has sold approximately 1.8 million SOL tokens for prices between $85 and $110, with claims indicating that bids at $95 and above were successful. The sale, which concluded on April 25th, is part of the estate's efforts to reduce the debt of the now-defunct cryptocurrency exchange. The locked Solana tokens, subject to a four-year vesting schedule, were acquired by investors including Pantera Capital. Prior to this auction, the FTX estate had sold $1.9 billion worth of Solana, with 41 million SOL tokens remaining.

FTX Estate Concludes Second Round of Solana Token Sales, Reducing Debt and Attracting Investors

April 30, 2024

In a significant move to reduce the massive debt incurred by the now-defunct cryptocurrency exchange, FTX, the estate overseeing its assets has successfully concluded the second round of sales for locked Solana (SOL) tokens. The sales generated bids reaching approximately $100 per token, reflecting a significant discount to current market prices due to the tokens' locked status.

Over the past few weeks, the estate has auctioned off a total of 1.8 million SOL tokens, representing a value of approximately $232 million. Bids were finalized on April 25, with Know Your Customer (KYC) procedures and necessary paperwork completed today.

Bidders expressed varying levels of interest in the locked Solana tokens, with bids ranging from $85 to $110 per token. Initial claims indicated that bids at or above $95 would be successful. However, sources familiar with the matter later clarified that bids as low as $85 would likely be rejected.

At $95 per token, successful bidders secured a discount of approximately 26% compared to current market prices, while bids at $110 represented a discount of around 15%. This discount can be attributed to the fact that the tokens are locked, delaying their availability for immediate sale.

Galaxy Trading, a subsidiary of Galaxy Digital, played a prominent role in the auction, seeking additional funding from investors to bid for a portion of the locked Solana tokens from the estate. The firm raised the minimum investment requirement for this round, seeking commitments of at least $5 million from interested parties.

According to Bloomberg, Pantera Capital, a prominent venture capital firm focused on digital assets, also acquired a significant amount of locked Solana tokens in the latest auction. These tokens, like other locked Solana tokens sold by the estate, are subject to a four-year vesting schedule, gradually releasing them for sale over time.

The FTX estate has plans to launch the next auction for locked Solana tokens on May 1, as confirmed by Mike Cagney, CEO of Figure Markets. Figure Markets is establishing a special purpose vehicle to facilitate bidding in future auctions. This investment vehicle is open to non-U.S. investors and accredited U.S. investors, according to its website.

Prior to the recent auction, the FTX estate had already sold $1.9 billion worth of Solana tokens, representing approximately two-thirds of a larger SOL lot initially valued at $2.6 billion. That transaction had included up to 30 million SOL tokens priced at $64 each.

However, the initial sale was temporarily postponed due to heightened interest from buyers. Galaxy Trading announced its intention to acquire a substantial portion of FTX's SOL holdings, establishing a $620 million fund for that purpose and charging a management fee of 1%.

Currently, the FTX estate still holds approximately 41 million SOL tokens in its possession, all of which are locked and valued at an estimated $7.5 billion based on current market prices. The Solana token itself has exhibited volatility in its trading price, recording a value of $174.2 today at 1 p.m. ET, following a nearly 7% decrease over the past 24 hours.

Since the collapse of FTX in November 2022, there has been significant interest from investors in acquiring a share of the firm's Solana holdings, which constituted a substantial portion of FTX's digital asset portfolio. Other major assets held by FTX included bitcoin, ether, and the Aptos blockchain's native token, APT.