A US bankruptcy judge lets FTX sell its derivatives exchange LedgerX, clearing platform Embed, and European and Japanese divisions to raise money for creditors
Benjamin Robertson / The Block :
Context & Ripple Effects
FTX bought LedgerX in September 2021 to bring US-regulated futures and options under its own roof (an acquisition made at the peak of its expansion). After the collapse, the subsidiary became one of the estate's cleanest assets: it was put up for sale in December with interest from Blockchain.com and Gemini, and a November filing showed roughly $303M in cash on its books.
The judge's approval converts that interest into an executable sale covering LedgerX, clearing platform Embed, and the European and Japanese divisions — part of a broader court-supervised liquidation that later extended to permission to sell, stake, and hedge the estate's $3.4B+ crypto holdings.
First-order effects
- Creditors gain a funded recovery path from operating businesses rather than only residual crypto, with LedgerX's cash position and the $175M it earmarked for the CFTC application now flowing toward the estate.
Second-order effects
- Surviving exchanges like Gemini and Blockchain.com can acquire a US-regulated derivatives license outright instead of building one, shifting competitive ground in US crypto derivatives toward whoever wins the auction.
Third-order effects
- If the pattern holds, distressed crypto bankruptcies will unwind through piecemeal court-approved asset sales that redistribute regulated infrastructure to acquirers, making Chapter 11 courts the de facto market mechanism for trading licenses and regional operations.
The trend: Crypto insolvency is resolving through judicially brokered asset disbursements that transfer regulated venues and regional units from collapsed platforms to surviving operators.