Home Markets FTX to sell European subsidiary for $33 million

FTX to sell European subsidiary for $33 million

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FTX to sell European subsidiary for $33 million
  • FTX sought to claw back $323 million from founders of FTX Europe, a crypto platform the bankrupt exchange acquired in 2021.
  • According to court documents, FTX argued the exchange had overpaid for the startup.
  • The settlement means FTX Europe founders will now buy back their company for $32.7 million.

FTX, the bankrupt crypto exchange that shocked the crypto world when it imploded in 2022, has agreed to sell its European subsidiary to the original owners.

After dropping a case that sought to claw back money used to buy the Europe-based crypto startup, FTX agreed to sell it back to its founders for $32.7 million.

The settlement is well below the $323 million FTX spent on the deal in 2021.

FTX sells assets of FTX Europe back to founders

According to documents filed in the bankruptcy court in Wilmington, Delaware on Thursday, FTX has settled with founders of FTX Europe. Formerly Zurich Digital Assets DA AG before a rebranding, FTX Europe was the crypto exchange’s gateway to the European market.

Now it’s part of FTX’s ongoing efforts to claw back money allegedly misspent on deals, ostensibly led by founder and former CEO Sam Bankman-Fried. The disgraced Bankman-Fried is in jail awaiting sentencing after a jury returned a guilty verdict on all charges, including fraud, last year.

In its settlement with FTX Europe, the bankrupt crypto exchange noted that the deal to sell back the company to its founders constituted the best outcome for FTX creditors. The FTX team contended that the European-based subsidiary was unlikely to attract any bids.

While it overpaid when acquiring the Switzerland-based Digital Assets DA AG, this settlement ends any likely long litigation given FTX Europe had filed a counter lawsuit.

Patrick Gruhn and Robin Matzke, the founders of DA AG, denied the FTX allegations in their lawsuit and sought $256.6 million from the bankrupt exchange. Matzke told Reuters that the settlement with FTX “was a good result.”

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