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Crypto hedge fund Galois Capital shuts down, thanks to FTX collapse

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Crypto hedge fund Galois Capital shuts down, thanks to FTX collapse

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  • Crypto hedge fund Galois Capital is shutting down after facing significant losses in FTX’s collapse last year. 
  • The fund’s remaining money will be distributed to its investors. 

Popular crypto hedge fund Galois Capital is closing shop after operating in the crypto space for six years. The fund announced earlier on 20 February that it was shutting down due to the loss it faced after the collapse of FTX last year.

Galois Capital was identified as one of the most high-profile victims of Sam Bankman-Fried’s failed crypto empire. 

Galois Capital will return the remaining assets to investors

According to a report by the Financial Times, Galois Capital plans to return its remaining funds to its investors after closing the firm.

As per documents seen by FT, the firm informed its investors that it had halted all trading activities. 

In the letter to its clients, the hedge fund revealed that 90% of the funds that weren’t stuck in FTX would be returned to the investors.

The remaining 10% will reportedly remain with the fund until the finalization of discussions with auditors, administrators, and other stakeholders.

Co-founder Kevin Zhou stated that instead of going through a legal process and pursuing claims in bankruptcy court, the claims would be sold for approximately 16 cents on the dollar. Kevin Zhou further stated, 

“Given the severity of the FTX situation, we do not think it is tenable to continue operating the fund both financially and culturally, Once again I’m terribly sorry about the current situation we find ourselves in.” 

As one of the largest crypto-focused quantitative funds, Galois went from managing nearly $200 million in assets to reportedly losing $40 million in FTX.

The hedge fund was able to recover some of its funds from the bankrupt exchange, but nearly half of its assets have been stuck since November last year. 

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Saman Waris works as a News Editor at AMBCrypto. She has always been fascinated by how the tides of finance and technology shape communities across demographics. Cryptocurrencies are of particular interest to Saman, with much of her writing centered around understanding how ideas like Momentum and Greater Fool theories apply to altcoins, specifically, memecoins. A graduate in history, Saman worked the sports beat before diving into crypto. Prior to joining AMBCrypto 2 years ago, Saman was a News Editor at Sportskeeda. This was preceded by her stint as Editor-in-Chief at EssentiallySports.
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