FTX and Genesis Join Hands to Resolve Bankruptcy Case wafact

• The FTX and Genesis parties will resolve their disputes with their settlement.
• Gemini filed a lawsuit against Genesis alleging fraud against creditors.

FTX, the leading crypto exchange, is facing issues as its former CEO, Bankman-Fried has been accused of criminal charges. In the latest development, the bankrupt crypto firms FTX and Genesis have reached an agreement in principle. It would resolve the claims made by both firms in their ongoing lawsuits over Chapter 11 bankruptcy cases. 

On July 27, the bankrupt firms FTX and Genesis shared an announcement revealing that both parties had reached an agreement in principle, subject to documentation. It concerns a settlement that will resolve the claims made by both crypto firms. In the letter, their lawyers noted that through this agreement, both parties will resolve their disputes. Both firms were going to request that the bankruptcy court approve the deal. Moreover, the settlement is likely to bring relief to Genesis creditors.

Genesis Has Declined the FTX Statement

The crypto firm Genesis has become one of the largest creditors for the collapsed crypto exchange FTX and its affiliated companies, with a value of $226.3 million owned. According to the filings in January, it includes major creditors. On the other hand, FTX claimed that the crypto lender Genesis owned up to $4 billion, which it later reduced to a maximum of $2 billion. However, Genesis has rejected this statement. 

The lending divisions of Genesis have temporarily stopped the redemption of new loans due to the FTX collapse in November. After that, in early January, the company filed for Chapter 11 bankruptcy protection in New York bankruptcy court. The firm came to this settlement after facing a continuous loss due to the collapse of Three Arrow Capital and FTX last year.  

Adding to that, Genesis has joined hands with the crypto exchange Gemini by entering a major feud. It claims that it owns more than $1 billion of its customer’s deposits with Genesis. After the collapse, the crypto exchange Gemini filed a lawsuit against Genesis, alleging fraud against creditors.