FTX and Genesis Reach Agreement in Ongoing Bankruptcy Dispute
Bankrupt crypto firms FTX and Genesis have reached an agreement in principle that would resolve claims made by both parties in their ongoing dispute.
“The Parties have reached an agreement in principle, subject to documentation, regarding a settlement that would resolve, among other things, the claims asserted by the FTX Debtors against the Debtors in these Chapter 11 Cases and the claims asserted by the Genesis Debtors against the FTX Debtors in the FTX Chapter 11 Cases,” a letter filed by their legal representatives to Judge Sean H. Lane reads.
The letter did not include details about the settlement.
Genesis had emerged as the largest unsecured creditor of FTX and its affiliated companies, with $226.3 million owed, according to a January court filing that includes a list of major creditors. In parallel, FTX also claimed that Genesis owed nearly $4 billion, later reduced to $2 billion, which Genesis has denied.
Genesis Global Capital, the lending division of Genesis, temporarily halted redemptions and new loans in the wake of the collapse of FTX in November. This decision was made in response to the extreme market dislocation and loss of industry confidence caused by the FTX implosion, a spokesperson said at the time. The company then filed for bankruptcy protection in January, already weakened because of losses to the tune of several hundred million due to the collapse of Three Arrows Capital.
Genesis is owned by Digital Currency Group (DCG), which also owns CoinDesk.