FTX engages Galaxy Digital to oversee, sell, and hedge its crypto assets
Bankrupt exchange FTX wants to hire Mike Novogratz’s Galaxy to assist with selling, staking, and hedging its crypto assets. The proposed agreement would see Galaxy managing and trading certain digital assets owned by FTX to convert them into fiat currency or stablecoins. Additionally, Galaxy would be responsible for hedging FTX’s exposure to volatile cryptocurrencies such as Bitcoin (BTC) and Ether (ETH). Galaxy’s compensation would consist of a monthly management fee divided into a hedging fee based on the average net asset value of the assets being hedged and a liquidation fee calculated from the total proceeds of liquidated assets. FTX’s decision to hire an external investment manager like Galaxy is seen as beneficial due to Galaxy’s ability to sell significant crypto currency positions without adversely affecting the market. Galaxy’s confidential execution of trades would also prevent any unintended price movements. You might also like: ...