FTX Bankruptcy Estate to Claw Back $460M From Modulo Capital

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The FTX estate on Wednesday filed a motion to enter into a settlement that would recover $460 million in assets for stakeholders, marking a significant recovery in the ongoing bankruptcy case.

The assets are a clawback from Modulo Capital, a Bahamas-based hedge fund that received $475 million in seed capital from Alameda Research in 2022. Modulo Capital was founded in early 2022 and is headed by principals Xiaoyun “Lily” Zhang and Duncan Rheingans-Yoo, both acquaintances of former FTX CEO Sam Bankman-Fried.

Read More: FTX’s Bankman-Fried Gave Ex-Jane Street Traders Who Formed Modulo Capital $400M

The court filings said the agreement came “following constructive negotiations with the Modulo Entities and their principals.” The $460 million in recovered assets represents over 99% of Modulo’s remaining assets, and includes $404 million of cash, the filing said. Additionally, Modulo would relinquish any claim on $56 million in assets held in accounts at FTX.com and FTX US.

“The terms of the Agreement provide for the return of nearly all of the value transferred by the Alameda Debtors to the Modulo Entities while avoiding the time and expense of pursuing the Claims through litigation,” said the filing.

In November a leaked spreadsheet of Alameda’s venture capital investments revealed a mysterious "Modulo Capital" had received funding to the tune of hundreds of millions of dollars.

CoinDesk previously reported that Modulo Capital was a hedge fund founded by former traders at Jane Street, the company Bankman-Fried worked at before leaving to found Alameda Research.