- FTX was the driving force behind the investment round in Mysten Labs last year.
- A court will now be asked to review and maybe approve the plan.
Recently, attorneys for FTX Group and Modulo Capital revealed their desire to settle out of court, thus wiping away 99% of the VC firms’ books. Today, FTX announced plans to sell its ownership in Mysten Labs back to Mysten in an effort to raise as much money as possible.
Unlike Modulo, where financing seems to have come almost solely from FTX, Mysten Labs, the developers of the Sui blockchain, is a stable corporation with a $2 billion value after a fundraising round in 2022.
Indeed, FTX was the driving force behind the investment round in question. Mysten Labs received significant funding from a number of notable companies, including a16z, Binance Labs, Franklin Templeton, Circle Ventures, Coinbase Ventures, and many more. According to Reuters, at the time, FTX invested $1 million in SUI tokens and around $101 million in preferred stock in the firm.
Court to Approve the Plan
For up to a year after filing for bankruptcy, a firm may legally try to recover assets. Mysten, however, has decided to settle out of court, and the company is offering to purchase back both its shares and SUI tokens, although at a discount.
A court will now be asked to review and maybe approve the plan. Until then, other investors may compete for FTX’s Mysten Labs shares.
If the agreement goes through, the FTX Group would have made two clawback deals totaling over $500 million, which may be returned to worried clients of the defunct cryptocurrency exchange. Considering the FTX Group’s track record, further transactions comparable to this are quite probable.
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