Home News FTX Moves to Sell Digital Custody Subsidiary in Strategic Shift

FTX Moves to Sell Digital Custody Subsidiary in Strategic Shift

by dave
1 minutes read

In a strategic pivot, the FTX Debtors estate, under the guidance of CEO John Ray III, is making moves to divest from Digital Custody Inc. (DCI). Initially acquired through investments totaling $10 million in late 2021 and mid-2022, DCI is now on the brink of a new chapter with CoinList, poised to acquire it for a modest sum of $500,000, courtesy of financing from DCI’s founding CEO, Terence J. Culver.

The acquisition of DCI was aimed at bolstering custodial services for FTX.US and LedgerX. Yet, the whirlwind of events leading to FTX’s bankruptcy filing in November 2022 left DCI adrift, never fully assimilated into the FTX framework. The decision to sell DCI underscores a reassessment of assets following the cessation of FTX.US operations and the sale of LedgerX, rendering DCI superfluous to FTX’s ongoing restructuring efforts.

Despite this, DCI holds value through its licensure with the South Dakota Division of Banking, enabling it to offer custodial services. The choice of CoinList as the buyer reflects a strategic alignment, considering Culver’s involvement and the potential for expedited regulatory approvals, enhancing the sale’s efficiency.

With endorsements from both the Committee and the Ad Hoc Committee of Non-US Customers of FTX.com, the sale is moving forward, though FTX retains the option to entertain superior proposals until three days before the finalization. The arrangement includes a reverse-termination fee clause, ensuring commitment from the purchasing party.

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