Defunct Crypto Firms Hold $1.5 Billion in Digital Assets

Over the past few years, several digital asset firms have collapsed due to various reasons, including the earlier disasters of FTX and Terraform Labs. These collapses have left behind a significant amount of digital assets still held in the wallets of these defunct ventures. As of June 14, data from Arkham Intelligence shows that Terraform Labs still holds $2.45 million onchain, with most of that value residing in two tokens: $1.26 million in convex finance token (CVX) and $1.09 million in governance OHM (GOHM).

FTX, which followed Terraform Labs in November 2022, controls wallets holding $611.93 million in digital assets. Roughly $266 million stems from its 9.777 billion OXY tokens. Another $232 million is tied to FTT, the platform’s native token, which still trades at $0.90 per coin. As of press time, FTX wallets contain 257.87 million FTT. The firm also retains about $52 million in MAPS and $16.31 million in FIDA. FTX US, the American arm of the now-defunct exchange, still controls $1,640,348 in onchain assets, with the lion’s share coming from 5.938 million tron (TRX).

Blockfi, the crypto lender that filed for bankruptcy in November 2022 following its exposure to FTX, maintains $36.37 million in digital holdings. Most of that sum is concentrated in ethereum (ETH), with the firm sitting on 12,223 ETH valued at $30.84 million. Celsius Network, which halted withdrawals and entered bankruptcy in July 2022 amid liquidity woes and risky bets, currently holds $6.89 million. Its largest asset is $6.1 million in SAVAX, along with a smaller $576,000 in ETH. Wallets tied to Voyager Digital—which also filed for bankruptcy in July 2022—retain a relatively minor $41,600, indicating minimal onchain exposure.

Alameda Research, the quantitative trading arm of FTX, still holds a formidable $887.46 million in digital assets. Of that, roughly $735 million is in solana (SOL), with the firm’s wallets securing 5.099 million SOL. Alameda’s reserves also include $52 million in ETH and 205.006 BTC, worth $21.61 million. In contrast, Three Arrows Capital (3AC) holds a mere $46,036—just over $27,000 of which is in tether (USDT). At the time of writing, these eight defunct entities collectively hold an eye-popping $1.546 billion in onchain assets.

This situation highlights the ongoing challenges faced by investors and creditors as they seek to recover their assets from these defunct entities. The collapse of these firms has left a substantial void in the cryptocurrency market, with many investors still awaiting the return of their funds. The $1.5 billion in cryptocurrency represents a fraction of the total assets that were once managed by these companies. The situation underscores the risks associated with investing in the cryptocurrency market, where the lack of regulatory oversight and transparency can lead to significant losses for investors.

The collapse of these firms has also raised questions about the future of the cryptocurrency market. The $1.5 billion in cryptocurrency that remains trapped within these companies is a stark reminder of the need for greater regulation and oversight in the industry. Without these measures, investors may continue to face significant risks, and the market may struggle to regain the trust of investors and the public.

The situation also highlights the need for greater transparency and accountability within the cryptocurrency industry. The collapse of these firms has left many investors in the dark about the status of their assets and the efforts being made to recover them. Greater transparency and accountability would help to build trust in the industry and ensure that investors are better protected in the future.

The recovery of the $1.5 billion in cryptocurrency that remains trapped within these companies will be a complex and challenging process. The situation underscores the need for greater regulation and oversight in the cryptocurrency industry, as well as greater transparency and accountability. Without these measures, investors may continue to face significant risks, and the market may struggle to regain the trust of investors and the public.