BitGo, the firm tasked with locking down the crypto assets of bankrupt crypto exchange firm FTX, has recovered $740 million worth of assets so far, revealed a recent court filing.
FTX debtors are in the process of locating and securing the company’s digital assets. As part of this, the debtors hired BitGo as the custodian on Nov. 13. In exchange, BitGo charges a monthly fee for the debtors’ digital assets that are held in custodial wallets. “Initially, the average estimated monthly cost is expected to equal approximately $100,000, based on approximately $740,000,000 in value of Digital Assets that had been transferred to the Custodian’s custody as of November 16, 2022,” the filing states.
BitGO said that it now estimated the amount of recovered and secured assets to be around $1 billion, AP reported on Wednesday.
The assets are now locked in “cold storage” in South Dakota. In cold storage, crypto assets are held in hard drives that are not connected to the internet and are thus considered to be the most secure storage.
An earlier filing had shown that FTX had a cash balance of $1.24 billion, with $751 million held in debtor entities and $488 million with non-debtor entities.
The company owed $3.1 billion to its top 50 creditors, with the top three being owed over $500 million. In total, FTX believes that over a million creditors might be affected by the bankruptcy.
In addition to the monthly fee of $100,000, FTX has also paid BitGo a one-time upfront fee of $5 million to cover “onboarding and implementation costs,” according to the recent filing.
FTX Debtors, Employees
During FTX’s first bankruptcy hearing in Delaware on Nov. 22, it was revealed that there were more than 100 debtors tied to the group. “You have witnessed probably one of the most abrupt and difficult collapses in the history of corporate America,” an FTX attorney said, according to CoinDesk.
Calling the case an “unprecedented matter,” James Bromley of Sullivan and Cromwell, representing FTX, said that a “substantial amount” of the company’s assets are either missing or stolen.
In addition to debtors, employees working at FTX have also been financially affected by the collapse of the crypto exchange firm. According to a report by The Wall Street Journal, it was common for employees to get part of their pay in FTX’s FTT crypto token and also hold FTX equity.
Last fall, FTX CEO Sam Bankman-Fried offered staff an opportunity to buy the company’s shares at 50 percent discount to what certain venture capitalists paid at that time. Now the value of FTT has crashed and the shares of FTX are practically worthless.
Speaking to the media outlet, Nathaniel Whittemore, a former FTX marketing specialist who quit the firm, said that the average employee at the company is “devastated.”
“Not only did it seem they might be out of job, but they also were potentially facing the total loss of their savings. All I could think of was rage and white-hot anger.”