During a conversation between CoinDesk and the co-founder of Galois Capital, Kevin Zho, it was revealed that an estimated $40 million is now locked up in FTX.
The crypto hedge firm Galois Capital earned attention earlier this year for anticipating the Terra disaster, whose $60 billion stablecoin ecosystem collapse triggered the current bear market.
Depending on the outcome of the bankruptcy proceeding, Galois and other FTX investors may have to wait sometime to receive their cash.
Galois Capital confirmed on the record that it had “substantial funds locked on FTX” but had not used “any Bahamian means to get assets out.”
In a letter to Galois investors, Zhou said that it may be “a few years” before assets could be recovered.
We shall strive relentlessly to optimize our prospects of reclaiming any capital that has been trapped.
Due to the fact that FTX does not provide 1:1 backing for user-held money, FTX is unable to process withdrawal requests without a rescue capital bailout.
Zhou said in his conclusion that Galois is now considering whether to maintain regular operations, become a market-making business, or explore acquisition.