Alameda Research Drops Lawsuit Against Grayscale in FTX Saga

In a new development in the continuing legal drama, it has been revealed that Alameda Research, the former trading division of the insolvent cryptocurrency exchange FTX, has dropped its lawsuit against the industry titan Grayscale. This development comes after FTX’s debtors sued Grayscale in Delaware late March.

In the original complaint, Grayscale was charged with breaching trust agreements by allegedly obtaining exorbitant management fees totaling more than $1.3 billion. Furthermore, according to FTX-affiliated Alameda Research, Grayscale’s actions caused a 50% decline in the value of shares in its Ethereum (ETH) and Bitcoin (BTC) Trusts with regard to their respective asset valuations.

FTX, in its pursuit of injunctive relief, aimed to unlock over $9 billion in value for shareholders. The exchange also sought to recover over a quarter billion dollars for FTX debtors, emphasizing a commitment to maximizing asset recovery for stakeholders. FTX CEO John J. Ray III expressed the intention to address the alleged suppression of value caused by Grayscale’s actions.

Recent reports from Reuters indicate that Alameda Research, a key player in the legal battle, is withdrawing the lawsuit against Grayscale. While specific reasons for this withdrawal are not explicitly mentioned, it marks a significant development in the broader FTX-Grayscale legal dispute.

In response to Alameda’s decision to drop the lawsuit, a spokesperson for Grayscale stated, “Alameda’s voluntary dismissal underscores Grayscale’s position that this legal action was entirely without merit.” The crypto giant maintains its stance that the legal challenges brought forth by Alameda lacked substance.

In November 2022, FTX filed for bankruptcy, providing a background for these legal actions. Many court cases have been initiated as a result of FTX’s bankruptcy; one prominent case in this intricate story is the one in which Alameda Research sued Grayscale.

Stakeholders and industry watchers are waiting for more developments as the cryptocurrency sector struggles with complex legal issues and the withdrawal of Alameda’s complaint adds another chapter to the ongoing tale of FTX.