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The distressed cryptocurrency exchange FTX and its affiliated companies filed for Chapter 11 bankruptcy on Friday in a federal court in Delaware. FTX said bankruptcy proceedings were initiated to “begin an orderly process to review and monetize assets for the benefit of global stakeholders.”
Investors are now concerned about the billions of dollars in customer funds that FTX held.
According to a Financial Times report, the crypto Hedge fund Galois Capital has announced that around half of its funds remain on FTX. Galois co-founder Kevin Zhou has said that the funds locked in FTX could amount to around $100 million.
Earlier this year, Galois came into the limelight when its founder first predicted the collapse of Terra’s LUNA/USD native token.
Following the FTX debacle, Zhou has written to investors that while Galois had been able to pull some money from the exchange, it still had “roughly half of our capital stuck on FTX,” the report says.
“I am deeply sorry that we find ourselves in this current situation. However, we will work tirelessly to maximize our chances of recovering stuck capital by any means,” Zhou wrote.
Also Read: FTX US Warns Users Cryptocurrency Trading May Be Halted In Days Ahead
He added that it could take “a few years” to recover “some percentage” of its assets.
In the letter, Zhou said that his fund had left money in FTX because it had “a ton of open positions” that had to be closed. He added that the money wasn’t withdrawn due to “underappreciating the solvency risk with holding our funds at FTX.”
Galois is considered one of the industry’s biggest crypto-focused quant funds, and at present, it is managing more than $200 million in assets.
On Friday evening, FTX announced that the exchange had been hacked and advised users not to install any new updates and to delete all FTX apps.
Ethereum ETH/USD and Solana SOL/USD were among the tokens that left FTX’s official wallets and transferred to decentralized exchanges. More than $600 million in cryptocurrency reportedly disappeared from FTX wallets.
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Image and article originally from www.benzinga.com. Read the original article here.