Alameda Research, an affiliated debtor of FTX, has filed a lawsuit against Grayscale Investments seeking injunctive relief to recover share value for FTX Debtor’s customers and creditors. The suit, filed in the Court of Chancery in Delaware, also asserts claims against Grayscale CEO Michael Sonnenshein, Digital Currency Group (DCG) and its CEO, Barry Silbert.

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Alameda claims Grayscale’s actions have lowered share value by 90%

According to Alameda’s complaint, Grayscale’s fee structure and failure to allow investors to redeem shares in its trust products have lowered the value of Alameda’s shares by 90%. The complaint asserts that if Grayscale reduced its fees and allowed redemptions, FTX Debtor’s shares would be worth at least $550 million, or roughly 90% more than their current value.

Alameda seeks to unlock $9 billion in value

Alameda Research claims that Grayscale has collected over $1.3 billion in management fees, which violates its Trust agreement. The lawsuit seeks to “unlock $9 billion or more in value for shareholders of the Grayscale Bitcoin and Ethereum Trusts […] and realize over a quarter billion dollars in asset value for the FTX Debtors’ customers and creditors,” according to a statement.

Grayscale calls lawsuit misguided

In response to the lawsuit, a spokesperson for Grayscale called it “misguided” and claimed that Grayscale has been transparent in its efforts to obtain regulatory approval to convert GBTC into an ETF, which it says is the best long-term product structure for Grayscale’s investors. Grayscale is set to appeal the SEC’s decision to reject its application to convert GBTC into an ETF at a hearing on Tuesday before the Washington, D.C., Circuit Court of Appeals.

The lawsuit alleges Grayscale contrived excuses to prevent redemption

Alameda Research also claims that Grayscale has contrived excuses to prevent shareholders from redeeming their shares, imposing a “self-imposed redemption ban.” As a result, the Trusts’ shares trade “at approximately a 50% discount to Net Asset Value.”

Alameda Research aims to maximize recoveries for FTX customers and creditors

Alameda Research aims to maximize recoveries for FTX customers and creditors by unlocking value it believes is currently being suppressed by Grayscale’s actions. John J. Ray III, CEO and chief restructuring officer of the FTX Debtors, said, “We will continue to use every tool we can to maximize recoveries for FTX customers and creditors.”