Alameda Research files suit against Grayscale over ‘self-imposed redemption ban’

cointelegraph.com:

Alameda Research has filed suit against Grayscale Investments in the Court of Chancery in the State of Delaware, it announced March 6. It also made claims against Grayscale CEO Michael Sonnenshein, Grayscale owner Digital Currency Group (DCG) and the group’s CEO Barry Silbert. 

Alameda Research is an affiliate debtor of FTX, which filed for bankruptcy in November. The suit seeks to “unlock $9 billion or more in value for shareholders of the Grayscale Bitcoin and Ethereum Trusts […] and realize over a quarter billion dollars in asset value for the FTX Debtors' customers and creditors,” according to a statement.

Related: Digital Currency Group's Genesis implosion: What comes next?

The plaintiff claimed Grayscale charged over $1.3 billion in management fees in violation of trust agreements. In addition, it “contrived excuses” to prevent shareholders from redeeming their shares in what the statement described as a “self-imposed redemption ban.” As a result, the statement continued, the Trusts' shares trade “at approximately a 50% discount to Net Asset Value.” Therefore, the plaintiff claimed:

According to The Financial Times, Alameda owns 22 million shares in Grayscale’s Bitcoin (BTC) Trust and 6 million shares in its Ethereum (ETH) Trust.

The Court of Chancery describes itself as “a forum for the determination of disputes involving the internal affairs of […] Delaware corporations.” Fir Tree Capital Management filed a suit in the same court seeking similar remedies in December. 

1/ FTX CEO John Ray enters the ring. FTX filed a lawsuit against Grayscale and its parent company.This is a surprise.John Ray is turning over every rock - including legal challenges to Grayscale's model - to maximize recoveries for FTX