FTX and Genesis Global Strike Deal to Settle Bankruptcy Disputes

FTX and Genesis Global Strike Deal to Settle Bankruptcy Disputes

FTX and Genesis Global Capital have reached an agreement
to resolve a dispute between the debtors of the now-bankrupt cryptocurrency companies.
The agreement was disclosed in a letter that was filed by their lawyers in the US
bankruptcy court for the Southern District of New York yesterday (Thursday).

„The parties have
reached an agreement in principle, subject to documentation, regarding a
settlement that would resolve, among other things, the claims asserted by FTX’s debtors against the debtors in these Chapter 11 cases and the claims
asserted by Genesis’ debtors against the FTX’s debtors in the FTX’s Chapter 11
cases,” the letter noted.

FTX’s and Genesis’s Claims

Following the bankruptcy
of FTX, Genesis emerged as the largest unsecured creditor of the cryptocurrency
exchange, owed USD $226 million, according to court documents filed in January.
Besides that, FTX claims that Genesis Global owes it USD $3.9 billion, an amount that was later reduced to USD $2 billion. Genesis, however, denied the claims.

FTX filed an application
to recover the funds from Genesis Global in cash and cryptocurrencies in May.
The amount includes USD $1.8 billion in loans and USD $1.6 billion that Genesis
allegedly withdrew from FTX’s trading platform before both companies went
bankrupt. It includes
USD $273 million in collateral given to Genesis Global and USD $213 million
reportedly taken by the crypto lender’s subsidiary.

Genesis Global suspended
withdrawals last November, citing abnormal customer requests following the
collapse of FTX. Additionally, the crypto lending platform, which suffered
losses after the collapse of Three Arrows Capital, filed for bankruptcy in

Gemini Sues Genesis

Meanwhile, three
weeks ago, Finance
Magnates reported that Genesis’ parent company and its Founder, Barry Silbert, had
been sued by Gemini. The
cryptocurrency exchange claims that the crypto lender and Silbert perpetrated fraud against investors in a digital asset lending program operated by both companies.

and Genesis partnered in a lending program that offered investors interest of
up to 8%. However, following the insolvency of Genesis, the program suspended
customers’ withdrawals. Thus, Gemini is accusing Genesis and Silbert of being
behind its investors’ losses.

This article was written by Jared Kirui at www.financemagnates.com.

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