FTX sells $31.5 million worth of Solana amid market downturn

The bankruptcy estate of FTX and Alameda Research has unstaked 188,000 staked Solana tokens worth $31.5 million. Onchain analyst Ember_CN noted that the funds were moved to 30 addresses after the unstaking.

The redemption continues the trend of monthly unstaking of SOL by the defunct exchange dating back to November 2023. Each unlock has happened without fail every tenth day of the month and could continue for a while given the amount of SOL that the exchange still has.

According to Ember_CN, the FTX staking address has redeemed 8.407 million SOL tokens since it started in 2023. All the tokens are transferred to various addresses, followed by sales on centralized exchanges such as Binance and Coinbase.

Overall, the FTX estate has sold $1.094 billion worth of SOL through this method, with the average transfer price being $130. However, the exchange still has around 5.046 million SOL staked worth $726 million at current prices.

Interestingly, the recent redemption and potential sell-off coincides with a massive drop in SOL value, with the token dropping more than 8% over the last 24 hours. Its slump during that period saw it fall from around $160 to $141.43, but it has now recovered to around $146.

SOL decline is due to a broader market crash likely caused by geopolitical tensions resulting from Israel’s air attack on Iran’s nuclear facilities. The incident caused a 3.21% fall in the crypto market cap, with the S&P 500, Nasdaq, and Dow 30 also seeing a decline in value.

FTX is preparing for a new round of distributions

Meanwhile, the latest SOL unstaking by FTX administrators comes as the exchange prepares for the third phase of distribution to creditors. So far, the exchange has refunded over $7 billion to different classes of creditors, with the latest concluding on May 30.

While the exchange has yet to announce the date for the next round, signs of preparation are already evident, with FTX agreeing with the payment platform Payoneer to be its third distribution agent. This move will likely cater to several creditors in countries that have been previously restricted.

Still, several countries remain restricted, and there are concerns about repayments. These countries, such as China, Ukraine, Nigeria, and Russia, remain without a distribution provider that supports the jurisdictions.

Beyond that, there are concerns about unresolved disputed claims with FTX creditor Sunil Kavuri, noting that $2 billion in claims are still disputed. However, the exchange has set aside $6.5 billion in reserves for undisputed claims, and Kavuri expects most disputed claims will be allowed in the next round of payments.

Shaq settles FTX lawsuit for $1.8 million

Interestingly, the repayment efforts have not ended the various lawsuits over the FTX collapse. More than two years after it collapsed, Shaquille O’Neal, one of those involved in promoting the exchange, has agreed to settle a class-action lawsuit against him for $1.8 million.

O’Neal, popularly known as Shaq, agreed to settle the action without admitting any wrongdoing for representing that FTX was trustworthy for users. However, the settlement filed in Florida is still subject to approval by the judge.

Shaq’s decision is the first instance of a celebrity involved in promoting the FTX exchange having to settle. Other promoters, including Tom Brady, Steph Curry, and Gisele Bundchen, have had claims against them dismissed.

Interstingly, the FTX estate itself is engaged in various lawsuits to claw back money from those it alleged got funds from the exchange after it was insolvent. One of the lawsuits is against Binance, and there is also pending action against convicted former co-CEO Ryan Salame.

However, the exchange settled the lawsuit against Sam Bankman-Fried’s parents after they jointly filed for dismissal of the lawsuit without prejudice. FTX administrators initially initiated a lawsuit against them to claw back funds.

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