Galois Capital will return 90% of the available funds to investors and temporarily hold on to the remaining 10%.
Hedge fund Galois Capital, one of the failed FTXs, threw in the towel when half of its assets fell into bankruptcy. The fund later decided to close and return its remaining assets to investors. On November 12, 2022, the hedge fund admitted in a statement on its Twitter account that it has significant exposure to the FTX exchange.
According to the Financial Times, the fund has now informed investors in a letter that all trading has been suspended and the fund has canceled its position. Kevin Zhou, the co-founder of Galois Capital, apologized to his investors and indicated that the strong position of FTX makes them unable to support its ongoing operations.
In addition, the hedge fund said that investors will receive 90% of the available funds, which is not included in the FTX exchange. The company will keep the remaining 10% temporarily until the negotiations are completed.
Apart from that, Zhou also expressed a desire to sell the hedge fund instead of waiting for a long liquidation process that could take ten years. According to the co-founder of Galois Capital, those who receive these funds are more likely to file a lawsuit in bankruptcy court.
The FTX bankruptcy wiped out millions in corporate funding, including companies like New Huo Technology and Nestcoin. Galois Capital is also one of the many victims of the FTX crisis, with at least $50 million in cash tied to the exchange.
Meanwhile, according to Galois Capital’s approach, the largest investor of Mt. Gox also opted for an early payment option instead of waiting for a lengthy legal process that could take years. On February 17, Mt. Gox Investment Fund said it had decided to pay in September instead of waiting longer to get its assets back.
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