FTX, the bankrupt cryptocurrency exchange, has settled its European operations by agreeing to sell FTX Europe back to its founders for $32.7 million. This move comes nearly three years after Sam Bankman-Fried acquired the company for $323 million.
Transaction Details and Background
The sale of FTX Europe to its founders for a fraction of its purchase price indicates the challenges FTX faced in finding alternative buyers. The acquisition, made in 2021, involved the Swiss startup Digital Assets AG (DAAG), which was later rebranded as FTX Europe.
FTX’s efforts to recoup the acquisition cost included a lawsuit against the startup’s founders, Patrick Gruhn and Robin Matzke. The exchange claimed the deal was funded with customer funds and labeled the acquisition price as significantly inflated. In retaliation, Gruhn and Matzke demanded $256.6 million from FTX. The legal dispute concluded on February 21, with the sale agreement.
Interest from Other Crypto Exchanges
Following FTX’s Chapter 11 bankruptcy filing in the United States in November 2022, several crypto exchanges expressed interest in acquiring FTX Europe, eyeing a portion of its regional market share. Notably, Coinbase made attempts to purchase FTX Europe twice, in November 2022 and September 2023, with additional interest from Trek Labs and Crypto.com.
Operational Highlights and Future Plans
FTX Europe operated in the region for only eight months before launching a website in March 2023 for European customers to initiate withdrawal requests post-bankruptcy. As FTX navigates the final stages of its bankruptcy process, it aims to repay billions to its customers. Part of its strategy to gather funds for creditors included a recent approval to sell over $1 billion in shares of artificial intelligence company Anthropic on February 22.
