FTX, the insolvent cryptocurrency CeFi exchange that recently recovered over $7 billion after crashing over $9 billion in investors’ funds, is now making efforts to restart. Bloomberg reported on April 18 that Tribe Capital, a San Francisco-based investment firm that previously invested in FTX, is considering injecting more funds into the exchange.
Sources familiar with the matter revealed that Tribe Capital is planning to lead a fundraising effort of $250 million, with $100 million coming from the company and its limited partners.
However, in January, Arjun Sethi, the co-founder of Tribe, reportedly contacted FTX’s Committee of Unsecured Creditors and other potential investors to discuss the possibility of a financial infusion.
Tribe Capital Seeks to Revive FTX Exchange
The venture capital firm is said to be interested in working with other investors to bring the struggling crypto firm back to life. While the talks are still in the early stages, sources say that Tribe Capital is optimistic about the potential for a successful revival of FTX.
According to Bloomberg, Tribe’s proposal in January contained an estimated 9 million client accounts, including FTX US, FTX Australia, FTX Japan, FTX EU, FTX International, and LedgerX, while excluding a venture capital portfolio and crypto assets, among others. The exchange’s name would remain FTX if the relaunch process is successful.
Tribe, which was founded in 2018, was a venture partner in both the international exchange FTX and the American subsidiary FTX US. The San Francisco-based business manages more than $1.6 billion in assets and invests in a variety of firms, including crypto platform Kraken, payments processor Chipper Cash, and e-commerce vendor Shiprocket.
The Official Committee of Unsecured Creditors of FTX, however, tweeted on Tuesday that it was cooperating with the debtors to assess all options for restarting or selling the FTX exchanges in order to maximize value for creditors.
The Committee is working with the Debtors to evaluate all options to reboot or sell the FTX exchanges and create value for creditors.
— Official Committee of Unsecured Creditors of FTX (@FTX_Committee) April 18, 2023
It was stated,
“Until a formal process is launched, parties interested in purchasing or sponsoring a reboot of the FTX exchanges should contact the debtors and the Committee.”
A presentation made in bankruptcy court further states that John J. Ray III, the newly appointed CEO of FTX, plans to determine whether a restart is possible in the second quarter. In addition, FTX lawyer Andrew G. Dietderich stated at a recent hearing that the company is still considering the idea and that a restart would require a substantial sum of money, which might come from outside investors.
