FTX and Genesis reach an agreement to settle mutual claims
FTX and Genesis reach an agreement to settle mutual claims
Bankrupt FTX and Genesis Global announced an agreement that will help resolve disputes between the companies in Chapter 11 bankruptcy cases.
The collapsed FTX exchange had previously accused crypto lender Genesis of owing it $3.9 billion, but Genesis did not confirm the amount. The amount in dispute was later put at $2 billion, Coingape reported.
On July 27, lawyers for FTX and Genesis asked the court to declare that both sides' claims have been settled and that the companies have reached an agreement. The filing asks the court to approve the deal, but there is no information on how the settlement was reached.
Experts note that the agreement is likely to benefit and provide relief to many of Genesis' creditors. The parties are only concerned about delays in the court settlement, which could delay the payment of claims.
According to legal counsels for Genesis and FTX, the companies intend to confirm the settlement agreement immediately. They have filed a motion with the Court seeking approval of the Settlement Agreement.
Following the financial losses associated with the collapse of FTX and Three Arrows Capital last year, Genesis filed for Chapter 11 bankruptcy protection in federal court. In addition, a major scandal between Genesis and Gemini, in which the cryptocurrency lender was accused of misappropriating more than $1 billion in Genesis client funds, became known to the public and the media.
The result of failed negotiations between the two companies was Gemini's lawsuit against Genesis, alleging fraud against the lender. Gemini co-founder Cameron Winklevoss said that the company wanted to cancel its Earn product as early as October 2022. But it didn't because of misrepresentations by Barry Silbert, who assured the Winklevoss brothers that the project would continue and hid Genesis' insolvency.
Also read: Canadian regulator sets new rules for crypto assets.
