Another Crack in the Crypto, Galois Capital Shuts Down Due to Lost Funds in FTX Fall

On November 12th, 2022, Galois Capital, a hedge fund that had been adversely affected by the collapse of FTX, announced to wind up its operations.

According to a tweet shared by Galois Capital, the hedge fund had to shut down its operations after half of its assets became trapped in the sinking exchange. On a further note, the fund further revealed that it would be returning its remaining assets to investors.

According to a report, the fund has now informed investors in a letter that all trading had been suspended and the fund had rolled back its positions. Kevin Zhou, the co-founder of Galois Capital, expressed his sincere apologies to their investors and highlighted the gravity of the FTX situation. This makes it tough for the organization to justify its future operations.

Furthermore, the hedge fund declared that investors would be allocated 90% of the available funds, which are not held up in the FTX exchange. The remaining 10% will be retained by the company in the interim until negotiations are concluded.

Zhou expressed a preference for selling the hedge fund's claims rather than waiting for a lengthy bankruptcy process that could take up to a decade. According to the co-founder of Galois Capital, buyers of these claims are better equipped to pursue them in bankruptcy courts. This decision has been taken to streamline the process of moving the company funds to its stakeholders and would not require any legal intervention. 

This news again highlights the impacts that FTX had on the industry and the pitfall it created for other crypto businesses. However, the good thing is that markets are trying to overcome the negative sentiment and all are looking toward a bright future. 

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