Industry Updates

CoinShares reveals $30.3m exposure to FTX

ETP issuer had ‘significantly reduced’ exposure in the past week

Theo Andrew

a close-up of a compass

Europe’s largest digital asset issuer CoinShares has $30.3m of exposure to collapsing crypto exchange FTX, it has confirmed.

CoinShares said in a statement on Thursday it had “significantly reduced” exposure to FTX over the past week it still held over 10% of its net asset value Sam Bankman-Freid’s business.

The exposure includes $3.1m in 190 bitcoin and $1.2m in 1,000 ether, both of which are pending withdrawals.

Most of the assets, roughly $25.9m, are tied up in the US dollar and USD Coin, a digital stablecoin pegged to the US dollar. The group said it had a net asset value of $282.1m.

It added the CoinShares Physical exchange-traded products (ETP), which includes the CoinShares FTX Physical FTX Token (CFTT), “remain fully hedged and collateralised”.

On Thursday, the Bahamas securities regulator froze the assets of part of Bankman-Freid’s business as he looks to raise $8bn to save the exchange, the Financial Times reported.

Jean-Marie Mognetti, CEO of CoinShares said: “In light of the high level of public scrutiny over the financial position of FTX and in the spirit of transparency, we have decided to disclose our current exposure to FTX.

“Thanks to our prudent approach to risk, we had materially reduced our exposure to FTX exchange in response to increased volatility and uncertainty, ahead of FTX’s decision to freeze further withdrawals.”

The issuer added it has no exposure to FTX’s sister company Alameda Research.

It comes after investors rushed to withdraw their cryptocurrency from the exchange on Tuesday, following concerns over its relationship with Alameda Research.

The move led to a “significant liquidity crunch” which was later compounded after rival Binance decided to pull out of a rescue deal for FTX, citing an investigation from the Securities and Exchange Commission into how the exchange handled its customer funds.

The news sent crypto assets spiralling this week, impacting ETPs with direct exposure to the FTX token as well as the wider market. CFTT has now lost 91% of its value year to date.

On Wednesday, 21Shares said in a statement its 21Shares Solana Staking ETP (ASOL) could be indirectly impacted due to FTX’s large position in the token, which it may sell in a bid to raise liquidity.

Related articles


No ETFs to show.