Modulo’s $460 million settlement marks a significant recovery in the ongoing bankruptcy case.
bankrupt crypto exchange ftx Currently working towards recovering some customer funds Allegedly embezzled To that end, it filed a motion on Wednesday that would see it recover $460 million in assets to stakeholders. Per AdmissionThe funds are being recovered from Bahamas-based hedge fund Modulo Capital, which received at least $475 million from Alameda Research, the investment arm of FTX, over the course of 2022.
According to earlier reports, the Modulo Capital investment led by former CEO Sam Bankman-Fried was one of the largest investments in FTX (sbf, And as the new filing suggests, SBF may have directly directed Alameda Research to make various investments in Modulo in a series of transfers beginning in May 2022. On June 16, a partnership agreement was signed between Modulo and Almeida. And it was this settlement that saw Almeida transfer the money to Modulo, while receiving 20% ownership of Modulo’s Class A shares in return.
For many, there was more to Modulo’s funding than meets the eye. Modulo Capital was founded in March 2022 and is run by three former executives at Jane Street, a New York-based firm where SBF was once an employee.
were also reports that Bankman-Fried was romantically involved with Xiaoyun “Lily” Zhang, a co-founder of the obscure VC firm. Maybe that could provide the motivation and continued push to invest in modulo.
Modulo Capital agrees to terms, promises to pay $460 million
However, as per the settlement agreement, Modulo has now agreed to repay FTX $460 million. But, this represents only 97% of the entire amount of investment received from the bankrupt exchange. Modulo says it will pay $404 million in cash and also give up claims on assets worth $56 million on FTX’s crypto exchange. Whereas, the settlement also affects Almeida in such a way that it loses all its claims to the Modulo shares.
FTX is still far from short
Last week, FTX Issued A presentation to creditors where it was noted that claims against it totaled more than $11 billion. The bankrupt exchange also revealed that it has only $4.7 billion in assets, meaning an overall shortfall of around $7 billion.
Therefore, while Modulo’s $460 million marks a significant recovery in the ongoing bankruptcy case, this amount is only a small fraction (less than 7%) of the current shortfall. Nonetheless, the settlement means the companies can avoid a costly legal battle.
Mayowa is a crypto enthusiast/writer whose conversational character is quite evident in his writing style. He firmly believes in the potential of digital assets and takes every opportunity to reiterate this. He is also an avid reader, a researcher, an astute speaker and a budding entrepreneur. Although away from crypto, Mayowa’s distractions include discussing soccer or world politics.
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