FTX, Genesis reach in-principle agreement to settle bankruptcy case

Insolvent crypto exchange FTX and crypto lending institution Genesis have reached a contract in principle to deal with the claims brought by FTX in its personal bankruptcy case.On July 27, legal counsels for both companies sent a letter to personal bankruptcy Judge Sean Lane mentioning that they had accepted a settlement.However, the arrangement was in principle and did not offer any details on the settlement. Both companies are bankrupt and have actually been attempting to collect cash for lenders while under court supervision.The settlement would fix FTXs claims versus Genesis debtors and vice versa. It would likewise withdraw pending movements associated with those claims. Both parties intend to record and look for court approval of the settlement quickly, it mentioned. “The Parties have actually reached an arrangement in principle, subject to documents, concerning a settlement that would resolve, to name a few 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.” To allow time to finalize terms, they requested the court adjourn upcoming deadlines on present movements and due briefs. Snippet from the letter in Case No. 23-10063. Source: KrollFTX has actually previously claimed that Genesis, which is owned by Digital Currency Group, owed the bankrupt exchange as much as $4 billion. It decreased the amount to $2 billion according to a letter sent out to Judge Lane earlier this month.Related: FTX debtors object to Genesis important claims price quote of $ 0.00 Genesis submitted for Chapter 11 insolvency security in a New York personal bankruptcy court in January following the collapse of crypto hedge fund Three Arrows Capital. The crypto lender is the largest unsecured lender of FTX and its affiliates with $226 million owed, according to court filings. In June, FTX debtors objected to Genesis evaluation that it was entitled to claims totaling no, however, these claims and objections appear to have been settled with this most current development. Publication: Get your cash back: The unusual world of crypto lawsuits

Other Questions People Ask

What does the in-principle agreement between FTX and Genesis entail?

The in-principle agreement reached between FTX and Genesis aims to settle the claims that FTX has against Genesis in its bankruptcy case. This settlement is designed to resolve mutual claims between both parties, allowing them to withdraw pending motions related to these claims. While the details of the settlement have not been disclosed, both companies are working towards finalizing the terms and seeking court approval soon.

How will the settlement affect FTX's bankruptcy proceedings?

The settlement between FTX and Genesis is expected to streamline FTX's bankruptcy proceedings by resolving significant claims against Genesis. With this agreement, FTX can potentially recover funds owed by Genesis, which has been a major creditor. Additionally, the resolution of these claims may help expedite the overall bankruptcy process for FTX, allowing it to focus on repaying its creditors more efficiently.

What are the implications of the FTX and Genesis agreement for creditors?

The agreement between FTX and Genesis could have positive implications for creditors of both companies. By settling their claims, it may lead to a clearer path for recovering owed funds, particularly for FTX creditors who have been waiting for resolution. Furthermore, the withdrawal of pending motions related to these claims could reduce legal complexities and expedite the distribution of assets to creditors.

Why did FTX initially claim that Genesis owed them $4 billion?

FTX initially claimed that Genesis owed them as much as $4 billion due to various financial dealings and obligations between the two entities. This figure was later revised down to $2 billion in a letter sent to the bankruptcy judge. The discrepancy highlights the complexities involved in their financial relationship and the ongoing negotiations that have now led to an in-principle settlement agreement.

What steps are FTX and Genesis taking after reaching this agreement?

Following the in-principle agreement, FTX and Genesis are working to finalize the terms of their settlement and seek court approval. They have requested the court to adjourn upcoming deadlines related to current motions and briefs to allow time for this process. Both parties are focused on documenting the agreement thoroughly to ensure a smooth resolution of their bankruptcy cases.