As FTX filed for Chapter 11 bankruptcy protection, its stake in startups in the crypto-pe sector invested by FTX and its affiliates is also likely to be sold.

As FTX, FTS US, and Alameda Research are included in Chapter 11, shares of cryptocurrency startups held by these companies, including Appstos Labs, Myston Labs, and Near Protocol, are also expected to be sold.

According to DeInformation, FTX has invested more than $1 billion in startups.

The sale of shares in these companies will create cash that can be repaid to FTX customers and creditors, said DeInformation, adding that FTX will sell valuable assets as soon as possible.

According to Block Research, FTX Ventures and Alameda Research, subsidiaries of FTX venture investment, have invested in more than 250 startups.

It includes startups in various fields, including decentralized finance, web 3.0, and transactions.

FTX affiliates showed the most active performance in terms of venture investment in the first half of 2022, according to Double Rock.

According to the press release, FTX Group has about 130 affiliates, including FTX Dotcom Corporation, FTX US, and Alameda Research.

Chapter 11 takes place when a company wishes to restructure its management, unlike Chapter 7 in which assets are sold or liquidated. Chapter 11 Companies filing for bankruptcy can continue their day-to-day operations.

Chapter 11 FTX affiliates that filed for bankruptcy did not include FTX Digital Market, FTX Australia, FTX Express Pay, and FTX US derivatives trader Leisure X.

Bitcoin fell more than $1,000 to the $16,500 level on the news that it applied for FTX bankruptcy protection. Shares of virtual asset-related companies also plunged in the U.S. stock market.