Hedge Fund Galois Capital Has Half of Its Capital "Stuck on FTX"

The crypto hedge fund Galois Capital's co-founder, Kevin Zhou, revealed that half of the hedge fund's capital is left trapped on FTX. He wrote a letter to investors explaining the situation and said he was "deeply sorry" about the turn of events.

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According to the letter, Zhou explained that roughly half of the company's capital is "stuck on FTX." As reportd, Galois' assets under management (AUM) in June indicate it could be a loss of around $100 million.

"I am deeply sorry that we find ourselves in this current situation," Zhou said in the letter to Galois clients. "We will work tirelessly to maximise our chances of recovering stuck capital by any means," the Galois co-founder added. Zhou further stated that Galois had "a ton of open positions" that it was forced to close because of "underappreciating the solvency risk with holding our funds at FTX."

"I expect we will recover some percentage of our assets on FTX over the course of a few years," the Galois Capital co-founder added. According to reports, FTX's wallets were allegedly hacked and the crypto exchange's funds, according to onchain data, have been depleted to zero.