Updated February 25th, 2024 at 11:31 IST

FTX sells European arm to original proprietors for $32.7 million

Following FTX's bankruptcy, several crypto exchanges vied for the acquisition of the European division, eyeing a portion of FTX's regional market dominance.

Reported by: Business Desk
FTX | Image:Unsplash
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FTX’s European arm: Crypto exchange FTX has resolved a dispute concerning its European division, reverting ownership back to its original proprietors. As per a report from Reuters on February 24th, FTX has agreed to divest FTX Europe to its founders for $32.7 million, indicating challenges in securing alternative buyers. Originally acquired in 2021 for $323 million, the Swiss startup Digital Assets AG (DAAG), later rebranded as FTX Europe was at the centre of the controversy.

Before consenting to the sale, FTX pursued reimbursement for the expenditure on the acquisition, contending that it was financed using client funds and asserting that the purchase price was excessively inflated. In response, startup founders Patrick Gruhn and Robin Matzke refuted the allegations and counterclaimed $256.6 million from FTX. The resolution of the dispute was confirmed on February 21st, as reported by Reuters.

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FTX Europe's involvement in FTX's Chapter 11 filing in the United States in November 2022 marked a pivotal moment. Following its bankruptcy, several crypto exchanges vied for the acquisition of the European division, eyeing a portion of FTX's regional market dominance. Notable contenders included American crypto exchange Coinbase, which made two attempts to acquire FTX Europe in November 2022 and September 2023, amidst interest from firms such as Trek Labs and Crypto.com.

Operating in the region for just eight months, FTX Europe saw significant developments in March 2023 when it unveiled a website enabling European clients to initiate withdrawals for the first time post-bankruptcy declaration.

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FTX is currently in the final phases of its bankruptcy proceedings, aiming to fully reimburse its clientele amounting to billions of dollars. In a bid to recuperate funds for creditors, the company received approval on February 22nd to divest over $1 billion in shares of the artificial intelligence firm Anthropic.

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Published February 25th, 2024 at 11:31 IST