Pantera Capital Wants to Buy $250M SOL From FTX, But There’s A Catch

Solana Cryptocurrencies to Watch

American digital assets-focused hedge fund Pantera Capital is seeking funds to purchase Solana tokens (SOL) worth $250 million from the liquidators of the bankrupt cryptocurrency exchange FTX.

According to a Bloomberg report, the Pantera Solana Fund has the option of buying the SOL at a 39% discount below the token’s 30-day average price of $59.95. However, the fund’s investors must consent to a four-year vesting period.

Pantera to Buy $250M SOL From FTX

A source familiar with the matter revealed that Pantera sought to close the fund by February’s end and has been raising money from large investors but has refrained from disclosing the amount raised so far.

The Pantera Solana Fund investors are mandated to contribute at least $25 million each to participate in the purchase. Pantera intends to charge a management fee of 0.75% and a performance cut of 10%. If the purchase is successful, the tokens will be released over four years.

Pantera’s proposal avails the FTX management an opportunity to raise more funds for creditors without exerting pressure on the price of SOL. The Pantera pitch documents seen by Bloomberg revealed that FTX held 41.1 million SOL, valued at approximately $5.4 billion at Wednesday’s closing prices and representing 10% of the token’s total supply.

SOL Gains Over 600% in a Year

FTX’s large SOL holdings are part of its active involvement in the Solana ecosystem before its demise in November 2022. The bankrupt crypto exchange’s founder and former chief executive officer Sam Bankman-Fried (SBF) and its sister trading firm Alameda Research were significant backers of the Solana network. They were among the driving forces behind the network’s growth and made heavy investments in Solana-focused startups. 

SOL, on its part, has increased by more than 600% in the past year, returning to levels last seen in January 2022 during the onset of the bear market. At the time of writing, the asset was worth $146 with a market cap of over $64 billion, per data from Cryptocurrencies To Watch. Activity on the Solana network has also recovered significantly after being hit by news of FTX’s bankruptcy.

Meanwhile, SBF is currently awaiting sentencing at the Metropolitan Detention Center, Brooklyn, after a jury found him guilty of multiple charges of fraud.