Alameda looks to rally up co-plaintiffs in case against Grayscale

More than 45 individuals, funds and family offices “have already indicated they are willing to participate,” FTX debtor affiliate claims

article-image

Castleski/Shutterstock modified by Blockworks

share

The crypto hedge fund founded by Sam Bankman-Fried says it’s in the process of assembling more plaintiffs to join the firm in its suit against Grayscale Investments. 

Alameda Research — a debtor affiliate of crypto exchange FTX, which filed for bankruptcy last November — sued Grayscale, Digital Currency Group (DCG) and DCG CEO Barry Silbert in March. It claimed at the time that Grayscale’s fee structure and redemption ban on its bitcoin (BTC) and ethereum (ETH) trusts had lowered the value of Alameda’s shares by 90%.

Alameda said in an August 2 motion to the Delaware Chancery Court that more than 45 parties, including individuals, funds and family offices “have already indicated they are willing to participate as additional plaintiffs.”

These individuals and entities were not named in the document.

Law firms Quinn Emanual Urquhart & Sullivan and Abrams & Bayliss, which represent Alameda in this case, did not immediately return a request for comment.  

But Alameda requires more time “to continue to assemble plaintiffs to participate alongside it,” the motion adds. The court is giving the plaintiff until Sept. 15 to respond to Grayscale’s motion to dismiss.

The lawsuit is “entirely without merit,” a Grayscale spokesperson told Blockworks Thursday, declining to comment further.  

Alameda said the shares of the Grayscale Bitcoin Trust (GBTC) and the Grayscale Ethereum Trust (ETHE) were trading at a discount of roughly 50% when it filed the lawsuit — a price about half the value of the bitcoin and ether backing them.

That resulted in a loss in market capitalization of about $9 billion for the two trusts for investors, the FTX debtor said in its March 6 complaint

“For the Alameda debtor alone, the discount equates to a loss in the market value of its holdings in the Trusts of over $250 million,” it added.

GBTC was trading at a discount of 25.8% to its net asset value on Wednesday, according to YCharts.com, while the discount of ETHE stood at roughly 34.2%.  

In need of more plaintiffs

The suit came about five months after the collapse of FTX, which, like Alameda Research, was founded by Bankman-Fried. The former FTX CEO was originally charged with wire fraud, conspiracy to commit securities fraud, and other charges in an eight-count indictment — to which he pleaded not guilty

Read more: US prosecutors drop campaign finance charges against SBF

John J. Ray III, which now serves as FTX’s CEO and chief restructuring officer, said in a March statement that it would “use every tool we can to maximize recoveries for FTX customers and creditors.”

Alameda’s effort to assemble more plaintiffs follows Grayscale’s motion to dismiss the case in May. 

Grayscale argued that certain claims relating to sponsor fees would only be permitted under the trust agreements if brought by at least two unaffiliated shareholders who jointly own at least 10% of the trusts’ outstanding shares, Bloomberg Intelligence litigation analyst Negisa Balluku said in a Thursday research note. 

An unnamed “significant shareholder” of the Grayscale trusts expected to be an additional plaintiff backed out of joining the litigation on July 31, it said in the Aug. 2 document — leaving Alameda short of the 10% shareholder support. 

“Even if Alameda eventually secures the necessary shareholder support, its attempt to unlock about $9 billion through a reduction of fees and implementation of a redemption program may still face dismissal,” Balluku wrote.


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Decoding crypto and the markets. Daily, with Byron Gilliam.

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

Industry City | Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

Brooklyn, NY

SUN - MON, JUN. 22 - 23, 2025

Blockworks and Cracked Labs are teaming up for the third installment of the Permissionless Hackathon, happening June 22–23, 2025 in Brooklyn, NY. This is a 36-hour IRL builder sprint where developers, designers, and creatives ship real projects solving real problems across […]

recent research

Research Report Templates.png

Research

Maple Finance has successfully navigated significant market challenges through its strategic pivot to secured lending (Maple v2) and the launch of its Syrup product. Syrup has become a primary growth driver, delivering sustainable, outperforming stablecoin yields and rapidly increasing TVL. The upcoming custody-first Bitcoin staking product (istBTC) presents another significant avenue for expansion. Crucially, Maple has achieved operational profitability, a key inflection point that, combined with a fully vested token and active buyback mechanism, strengthens its investment case. While valuation metrics suggest potential undervaluation relative to peers and growth, the primary forward-looking risk identified is the long-term sustainability of its current high-take-rate collateral staking revenue model.

article-image

Prediction markets show that people bet in anticipation of things happening far too often

article-image

The agency’s final deadline is in October

article-image

Higher inflation historically lags behind tariff implementation, so don’t celebrate just yet

article-image

VanEck launches its first tokenized fund after financial giants convene at SEC roundtable

article-image

The “GameFi” platform that began its development while part of Zynga is launching another NFT collection

article-image

Funds disagree about which metrics matter, but agree fundamentals are key