Genesis Reaches $175 Million Settlement with FTX – Coinpedia Fintech News

Cryptocurrency lender Genesis Global Capital has reached a settlement deal with the bankrupt exchange FTX, agreeing to pay $175 million to resolve outstanding claims between the two entities.

Genesis will pay the funds to Alameda Research, the trading firm co-founded by FTX founder Sam Bankman-Fried. In return, FTX will drop its nearly $4 billion claim against Genesis tied to loans between the two companies.

Both Genesis and FTX filed for bankruptcy in 2022 amidst the massive fallout from FTX’s collapse. The tangled financial relationship between the firms led each to assert claims against the other in bankruptcy court.

Genesis will waive any remaining claims of its own against FTX

Under the new settlement, Genesis will waive any remaining claims of its own against FTX. This is intended to smooth the path for Genesis to confirm its restructuring plan and emerge from bankruptcy.

“The settlement will…significantly smooth the path to confirmation of the Genesis bankruptcy plan, as well as eliminate the risks, expenses, and uncertainty associated with protracted litigation,” said Genesis in its court filing announcing the deal.

The agreement closes the book on the bitter legal battle sparked by FTX’s implosion last November. Genesis interim CEO Derar Islim stated that the deal removes significant litigation risk and expense as Genesis works to regain its financial footing.

While costly, the settlement untangles the complex web of obligations left in the wake of crypto’s largest collapse to date.

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