Connect with us

Hi, what are you looking for?

Business

Alameda Research withdraws its lawsuit against Grayscale

Grayscale was accused by the FTX hedge fund of implementing a “self-imposed redemption ban,” but funds are now fleeing the company in droves.

A new court filing indicates that Alameda Research, a sister firm of FTX, has withdrawn its lawsuit against Grayscale Investments in relation to the transformation of its primary trust product into an exchange-traded fund (ETF). The lawsuit, which was initiated in March 2023, sought injunctive relief against alleged practices that inflated the worth of the assets owned by FTX debtors.

The lawsuit asserts that in the aftermath of FTX’s failure, Grayscale’s Bitcoin Trust (GBTC) ensnared investor funds in excess of $9 billion. The grievance was lodged as an element of broader initiatives to recover and “maximize” recoveries for FTX clients whose funds were either lost or frozen on the platforms of the defunct cryptocurrency exchange and its affiliates. Additionally, the suit claimed Grayscale charged exorbitantly high fees. The filing on Monday failed to offer an explanation regarding Alameda’s decision to dismiss the lawsuit.

GBTC commenced trading as an exchange-traded fund (ETF) on the New York Stock Exchange earlier this month. Previously, it functioned as a closed-end fund, thereby imposing challenges on clients seeking to pay out or redeem their funds. However, ever since its transformation into a Bitcoin spot ETF, investors have been promptly redeeming their holdings. The redemption of billions of dollars last week precipitated a precipitous decline in the value of Bitcoin (BTC).

A representative of Grayscale, who verified the news, further stated that Alameda’s withdrawal supports the asset manager’s position on the motion. Sonnenshein’s firm had previously contended that the cryptocurrency trading firm affiliated with FTX lacked any valid legal basis to initiate a lawsuit.

author avatar
Contributor
We welcome Aspiring writers who are passionate about crypto and involved in it to join the Unbiased and Upright 4C Media Co. with a goal to spread knowledge and be a reliable source of crypto news updates.
Advertisement

You May Also Like

Uncategorized

Industry experts note that stablecoin regulations and banking access should take priority over cryptocurrency tax reforms in the U.S. Clear laws can encourage mainstream...

Cryptocurrency

Amid the financial pressure on many companies to examine Bitcoin, it is estimated that a quarter of the S&P companies will have Bitcoin in...

Cryptocurrency

Binance has added a new feature that lets users trade directly from CEX to DEX without having to bridge assets or move funds by...

Cryptocurrency

Decentralized finance has transformed our trading, borrowing, and lending. These services are now available to users directly, without middlemen. The popularity of DeFi is...

polkadot
Polkadot (DOT) $ 4.10 2.11%
bitcoin
Bitcoin (BTC) $ 84,256.57 0.69%
ethereum
Ethereum (ETH) $ 1,823.39 0.15%
cardano
Cardano (ADA) $ 0.665288 2.19%
xrp
XRP (XRP) $ 2.10 2.00%
stellar
Stellar (XLM) $ 0.264261 0.65%
litecoin
Litecoin (LTC) $ 84.98 1.36%