FTX and Genesis Reach Agreement in Principle to Settle Bankruptcy

Author: MARTIN YOUNG, COINTELEGRAPH; Compiler: Songxue, Jinse Finance

** Bankrupt cryptocurrency exchange FTX and cryptocurrency lender Genesis have reached an agreement in principle to resolve claims brought by FTX in the bankruptcy case. **

On July 27, legal counsel for both companies wrote to bankruptcy judge Sean Lane saying they had agreed to a settlement.

However, the agreement was an agreement in principle and did not provide any details of the settlement.

Both companies are bankrupt and have been trying to raise money for creditors under court supervision.

**The settlement will resolve FTX’s claims against Genesis debtors and vice versa. It will also withdraw pending motions related to those claims. Both parties intend to immediately record and seek court approval for a settlement, the statement said. **

“The parties have reached an agreement in principle, according to the documents, with respect to the settlement, among other things, of the claims of the FTX debtors against the debtors in these Chapter 11 cases and the claims of the Genesis debtors against the FTX debtors of the FTX Chapter 11 cases.”

To allow time to hammer out terms, they asked the court to delay the deadline for the current motion and due brief.

Excerpts from letters in case number 23-10063. Source: Kroll

FTX previously claimed that Digital Currency Group’s Genesis owed the bankrupt exchange as much as $4 billion. However, the company reduced the amount to $2 billion, according to a letter sent to Judge Lane earlier this month.

Genesis filed for Chapter 11 bankruptcy protection in New York Bankruptcy Court in January following the collapse of cryptocurrency hedge fund Three Arrows Capital.

The cryptocurrency lender is the largest unsecured creditor of FTX and its affiliates, owed $226 million, according to court documents.

In June, FTX debtors objected to Genesis’s estimate that it was entitled to claims totaling zero, but those claims and objections appear to have been resolved with this latest development.