- Lawyers for FTX and Genesis have filed a letter of settlement with the court over the debt claim.
- The exchange has demanded $3.9 billion from the cryptocurrency lender, accusing ex-CEO of FTX Sam Bankman-Fried of participating in a fraudulent scheme.
Cryptocurrency exchange FTX and platform Genesis Global have reached an “agreement in principle,” according to court documents. FTX previously claimed $3.9 billion in outstanding obligations from the cryptocurrency lender.
The letter was drafted by lawyers for both parties and sent to a judge as part of the bankruptcy case. It said the companies have entered into a settlement agreement, but its terms were not disclosed.
The document also said FTX and Genesis Global will soon file motions with details of the deal. But exactly when that will happen is not yet known.
FTX made the claim to Genesis Global in early May 2023. The exchange’s new management said the platform was an important element of Sam Bankman-Fried’s fraudulent scheme.
The $3.9 billion figure included a $1.8 billion loan from Alameda Research, the collateral on it, and the $1.6 billion that Genesis withdrew in a bankruptcy bypass immediately after the exchange’s collapse.
In early July 2023, FTX reduced the claim to $2 billion. But even with that in mind, the exchange’s claim could significantly delay payments to Genesis Global’s creditors, Judge Sean Lane noted earlier.
The firm filed for Chapter 11 under the U.S. Bankruptcy Code in late January 2023. At the time, its liabilities to large clients alone totaled about $3.5 billion.
In February 2023, Digital Currency Group (DCG) Holding, the parent company of Genesis Global, proposed a plan to address the crisis. But as early as April, the unit’s restructuring proceedings broke down, DCG said – due to “some creditors.”
The parties have until Aug. 2 to submit a new plan. However, at the time of writing, there were no new details on the matter.
At the time of writing, there were no new details on the matter.