Crypto Market Sees Significant Bitcoin Transactions: Trump Media Continues Sales, Coldcard Incident Losses Mount, and FTX Creditors Receive Payouts

In a notable day for the cryptocurrency market, several significant developments have captured attention. Trump Media & Technology Group has continued its series of Bitcoin sales, transferring an additional 2,628 BTC to Crypto.com. Concurrently, Galaxy Research has provided an updated estimate for losses stemming from the Coldcard wallet incident, placing the figure at 1,367 BTC, equivalent to approximately $88.6 million. Meanwhile, a ray of hope has emerged for former FTX users as the FTX Recovery Trust has launched a new $900 million creditor payout, bringing the total estimated repayments to around $11 billion.

Trump Media & Technology Group Divests Further Bitcoin Holdings, Reducing Reserves to 4,261 BTC

Trump Media & Technology Group (TMTG), the company behind the social media platform Truth Social, has once again engaged in significant Bitcoin sales, moving 2,628 BTC valued at roughly $165 million through transfers to the cryptocurrency exchange Crypto.com. This latest transaction marks another step in the company’s ongoing strategy of liquidating portions of its Bitcoin holdings.

According to data from blockchain analytics platform Lookonchain, TMTG initially acquired 11,542 BTC at an average purchase price of $118,522. The company commenced its selling spree approximately seven months ago. The most recent transfers have brought TMTG’s cumulative reported Bitcoin sales over this seven-month period to a substantial 7,281 BTC, representing an estimated value of $545 million. Lookonchain’s analysis indicates an average selling price of $74,855 per BTC for these transactions. Following these sales, Arkham, another analytics firm, reported that TMTG’s remaining Bitcoin reserves stood at 4,261 BTC at the time of publication, with a current market value of $269.8 million.

These Bitcoin divestments by Trump Media occur amidst the company’s strategic moves to monetize its digital assets and potentially fund new ventures. Notably, TMTG recently launched "Truth API," a new paid data service designed to offer expedited access to President Trump’s posts on Truth Social. This service reportedly carries a monthly subscription fee of up to $100,000, providing businesses with a "direct, licensed, real-time feed of the platform’s most market-moving Truths." The move into data services suggests a broader business strategy beyond social media operations, with the Bitcoin sales potentially providing the capital necessary for these expansions.

Coldcard Bitcoin Incident Losses Estimated at $88.6 Million Following Galaxy Research Analysis

Galaxy Research, the analytical division of the prominent crypto investment firm Galaxy Digital, has identified 4,585 addresses associated with the Coldcard wallet incident that resulted in the loss of 1,367 BTC. The estimated financial impact of this incident has been calculated at $88.6 million.

The Coldcard incident is reportedly attributed to a vulnerability in the seed generation process, where a bug affected certain wallets by reducing the randomness used in creating recovery phrases. This compromised the security of these specific wallets, making their private keys potentially susceptible to discovery and exploitation by malicious actors, enabling them to move the funds held within. The revelation of these losses underscores the ongoing security challenges and potential vulnerabilities within the cryptocurrency ecosystem, even with hardware wallets designed for enhanced security.

In a related observation, data compiled by Julio Moreno, head of research at CryptoQuant, indicates a significant increase in smaller Bitcoin transactions. On Friday, Bitcoin transfers below 1 BTC reached their highest daily volume since November 2022, with a total of 39,600 BTC being moved. This figure was only slightly below the 39,900 BTC transferred on November 16, 2022, a period that coincided with FTX filing for bankruptcy. Moreno commented on this trend, noting that "The Bitcoin plebs had not moved this amount of BTC in a day since the FTX collapse," and expressed encouragement at observing users "taking action," suggesting a potential shift in user behavior or a response to market events.

FTX Creditors Begin Receiving Funds in $900 Million Payout as Recovery Trust Continues Distributions

A significant milestone in the lengthy recovery process for former FTX users has been reached, as individuals have begun receiving reimbursements following the FTX Recovery Trust’s initiation of a new $900 million distribution to creditors. This marks the fifth distribution phase since the cryptocurrency exchange filed for bankruptcy in November 2022.

Users, including former FTX customer Sunil Kavuri, have reported the arrival of funds through distribution partners such as Kraken, following notifications that were sent out the previous week. This latest payout is a crucial component of the broader FTX asset recovery initiative, which involves several key platforms, including BitGo and Payoneer, facilitating the return of assets to former customers.

With the commencement of this latest $900 million distribution, the FTX Recovery Trust is now estimated to have returned approximately $11 billion to customers who lost access to their digital assets following the exchange’s sudden collapse. The downfall of FTX was primarily attributed to the misappropriation of customer funds, which led to criminal convictions for several of its former executives. Former CEO Sam Bankman-Fried and former FTX Digital Markets co-CEO Ryan Salame are currently serving prison sentences, while former Alameda Research CEO Caroline Ellison completed her prison term earlier this year.

In a separate but related legal development, a U.S. bankruptcy judge has recently granted the FTX estate permission to proceed with a $1.76 billion clawback claim against Binance and its former CEO Changpeng Zhao. This decision follows the rejection of broader damages claims, indicating a focused legal pursuit of specific assets and liabilities. The ongoing legal and financial proceedings surrounding FTX continue to be closely watched by the crypto community, as they represent one of the most significant collapses in the industry’s history.