Alameda-backed trading shop Folkvang says it can 'easily absorb' hit from FTX exposure

Quick Take

  • Crypto  trading shop Folkvang has some assets on FTX to facilitate trading but can “easily absorb this hit.”
  • The firm said on Twitter it is “highly liquid and  extremely solvent.”

Crypto trading shop Folkvang has some assets locked on FTX that it has used to facilitate trading, but can "easily absorb this hit."

The firm issued a statement on Twitter outlining its exposure, alongside a number of other trading firms, including GSR and Genesis.

"Folkvang is highly liquid and extremely solvent," it said. "Folkvang does hold some assets on FTX to facilitate trading; thankfully, we are well diversified and not exposed to any single point of failure, including FTX."

FTX announced that it was facing a liquidity crunch earlier this week and that it would be acquired by rival exchange Binance. The deal with Binance fell through on Wednesday. On Thursday, FTX CEO Sam Bankman-Fried apologized and said that he would look to wind down trading at sister firm Alameda Research

Folkvang is a crypto quantitative trading firm and liquidity provider that trades across major coins and exchanges, according to its website. It was founded in 2020 and its only listed outside investor is Alameda Research, according to data from Crunchbase.

The firm's CEO and head of trading, Mike van Rossum, was referred to as a "key player" on the FTX exchange by Bankman-Fried when Alameda made its investment in 2020.

There has been crypto twitter speculation that Folkvang might be heavily impacted by the financial woes of FTX and Alameda Research.

Still, the firm said: "It has been a very dark and difficult few days for crypto." It added: "We are absolutely shocked and saddened by the events of the week but have full faith that we can come out of this stronger. "

Disclaimer: The former CEO and majority shareholder of The Block has disclosed a series of loans from former FTX and Alameda founder Sam Bankman-Fried.

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