Galois Capital, a crypto hedge fund that engages in over-the-counter trading, has announced that almost half of its capital is locked up in FTX.

According to a Reuters news report, Galois co-founder Kevin Zhou stated that the trapped fund is estimated at $100 million despite the fact that the company had initially withdrawn some funds from the crypto exchange. He wrote to investors that he is deeply sorry about the situation as they did not see the 3AC situation coming. He added that it could take Galois a few years to recover from his current ordeal.

Galois capital tweeted through the company’s official page that the funds were not withdrawn through any process from the Bahamas, as a significant amount is still blocked while they respond to allegations that they transferred FTX funds illegally through the use of accounts of the Bahamas. They also hinted that Galois does not have any debt, so only its assets were affected.

“Galois is currently debating whether to continue to operate normally, seek a acquisitionor become a proprietary trading company,” says Zhou.

The news comes after Galois initially offered suggestions on how FTX can overcome its financial crisis. Galois tweeted that FTX can apply a proportional debt haircut to all accounts, make a Bitfinex-style debt claim token for the amount of the haircut, and reduce staff while continuing to run FTX.

Cryptocurrency exchanges caught in the net of the FTX crisis

Galois Capital is not the only crypto exchange that is experiencing a mess as a result of the fallout from the FTX exchange. FiBlockA crypto lending exchange recently suspended customer withdrawals following the financial crisis that occurred with FTX.

BlockFi, which was worth $3 million at one point, announced earlier in the week that they would stop withdrawals, including deposits, due to a lack of uncertainty regarding the issues with FTX. BlockFi had entered into a $680 million deal with FTX.US earlier this year that included a $400 million credit facility and an option for FTX to purchase BlockFi.

Image Source: Shutterstock