An insolvent cryptocurrency exchange, FTX, may sell its share in the artificial intelligence startup Anthropic, a US judge ruled.
A bankrupt cryptocurrency exchange, FTX, may sell its stake in artificial intelligence startup Anthropic, a US judge determined Thursday.
U.S. Bankruptcy Judge John Dorsey in Wilmington, Delaware, accepted FTX’s proposal to sell the shares after reaching an agreement in court with a group of FTX customers who opposed the sale.
FTX invested $500 million in Anthropic in 2021 and presently owns 7.84 percent of the company, according to court records. The company had requested authorization to sell the shares as part of a court-supervised effort to liquidate its assets and compensate clients who lost access to their accounts when the company went bankrupt in 2022.
“We are selling the Anthropic shares, as we are selling everything, and putting the money in the bank,” FTX attorney Andy Dietderich said at a Thursday court hearing.
According to court filings, FTX hopes to benefit from the sale of the shares and will retain the flexibility to sell them at the “most optimal and appropriate time.”
“Given the increased interest in AI and large language models, there has been significant appreciation in the value of the Anthropic Shares since the Debtors’ acquisition and investment in Anthropic in 2021,” FTX said in a filing with the court on Feb. 3.
FTX’s 2021 investment initially resulted in a 13.56% equity holding in Anthropic. The company’s subsequent financing, including a $4 billion investment from Amazon.com, has diluted the FTX holding.
Customers who opposed the sale claimed that FTX did not legitimately own the Anthropic shares because they were obtained with cash embezzled from FTX client deposits. However, they decided Thursday to allow the sale to proceed, as long as they can subsequently argue that FTX customers own any proceeds from the future sale.
Dietderich stated that FTX already expects to refund clients with the sale proceeds and that it has enough cash to repay any specific group of customers who can persuade a court that they own the Anthropic shares. Dietderich reported that FTX now has $6.4 billion in cash.
FTX aims to reimburse all clients in full, but it will base their repayment on cryptocurrency prices as of November 2022, when FTX filed for bankruptcy amid a sustained collapse in the crypto market, rather than the current, higher worth of crypto assets.
On November 2, FTX founder Sam Bankman-Fried was found guilty of stealing billions of dollars from consumers in one of history’s largest financial frauds. Bankman-Fried’s sentencing date is March 28, and he is anticipated to appeal his verdict.
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