Genesis Debtors Authorized to Pay $175 Million to FTX
Following a court decision, Genesis debtors have been given the green light to execute a settlement agreement that involves paying $175 million to FTX. New York Bankruptcy Judge Sean Lane has also dismissed several claims made by FTX debtors against Genesis.
Withdrawal of Claims
The court has approved the withdrawal of multiple claims, including three from FTX Trading, six from Alameda Research, and six from West Realm Shires Services, representing FTX US. This marks a reduction from the initial claims made by FTX debtors, which totaled around $3.9 billion in May 2023.
A Reduced Settlement
The approved settlement represents a decrease from the original claims made by FTX debtors. These claims included alleged loan repayments from Alameda to GGC amounting to $1.8 billion and assets withdrawn by Genesis debtors from FTX totaling $1.6 billion.
A Controversial Partnership
Prior to Genesis’ bankruptcy filing, crypto exchange Gemini Trust Co. withdrew $282 million from Genesis Global Holdco LLC. This move raised questions about their partnership, as both companies had collaborated on the Earn program where users could lend their cryptocurrencies through Genesis for returns.
Hot Take: A Resolution Amidst Dissatisfaction
The court’s decision authorizing the settlement between Genesis debtors and FTX brings an end to a dispute that has seen dissatisfaction among creditors. While Genesis sees the settlement as fair and efficient in avoiding lengthy legal battles, FTX creditors have expressed discontentment and even urged challenges against the agreement. The withdrawal of claims and the reduced settlement amount reflect a compromise between the parties involved. The fallout between Genesis and Gemini Trust Co. adds an additional layer of complexity to the situation, raising questions about the nature of their partnership and the circumstances surrounding the withdrawal of funds.
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