Crypto Hedge Fund Galois Capital Shuts Down — ‘We Lost Almost Half Our Assets to FTX Disaster’

Cryptocurrency hedge fund Galois Capital is shutting down after losing about half of its assets in the FTX disaster. “Given the severity of the situation with FTX, we do not think it is not appropriate to continue to manage the fund both financially and culturally,” the fund’s co-founder told investors.

Crypto Hedge Fund closes due to FTX crash

Cryptocurrency hedge fund Galois Capital is shutting down as nearly half of its assets are locked up on FTX, a bankrupt cryptocurrency exchange that filed for bankruptcy last November. “Galois Capital is a crypto-currency hedge fund that specializes in OTC trading and algorithmic market making,” its website says.

According to documents seen by the Financial Times, Galois Capital told investors that all trading had been halted and all of its positions closed. Galois co-founder Kevin Zhou wrote:

Given the seriousness of the situation with FTX, we do not think that it is not appropriate to continue to manage the fund both financially and culturally… I am very sorry that we are in the current situation.

Hedge fund clients will receive 90% of the money not captured on FTX, Galois said, adding that he is temporarily holding the remaining 10% pending negotiations with fund administrators and an auditor. According to the publication, after informing investors about its closure, Galois sold the fund’s rights to FTX for about 16 cents on the dollar. Galois previously told Bloomberg that he has up to $45 million in assets exposed to the FTX bankruptcy.

Zhou is known for warning last year of the impending collapse of the terra (LUNA) cryptocurrency and the Terrausd (UST) stablecoin. He also profited from the sale of LUNA, now called LUNA classic (LUNC). Zhou opined:

This whole tragic saga, from the crash of the moon to the 3AC credit crunch to the FTX/Alameda debacle, has certainly set the crypto space back significantly.

Following news reports of the closure of his hedge fund, Zhou took to Twitter to confirm the closure of Galois’ flagship fund. On Monday, he tweeted:

Regardless, I’m proud to say that despite losing almost half of our holdings to the FTX crash and then selling for cents on the dollar, we’re among the few closing the store with initial performance. which is also positive.

“While this is the end of an era for Galois, the work we have done together over the past few years has not been in vain. I can’t say anything yet, ”concluded the co-founder of Galois.

What do you think about the closure of cryptocurrency hedge fund Galois Capital due to the fact that its assets were trapped in the collapsed cryptocurrency exchange FTX? Let us know in the comments below.