Crypto News – Genesis Global Trading (GGC) has been ordered to compensate FTX for a sum as high as $175 million. This order was the result of a lawsuit in which FTX, together with its affiliate Alameda Research, sought substantial financial compensation from Genesis.
New Development in Genesis and FTX Case: $175 Million in Compensation to be Paid
The settlement between the troubled cryptocurrency startups FTX and GGC was approved on October 11 by the United States Bankruptcy Court for the Southern District of New York. This agreement enables the Genesis debtors to pay FTX the $175 million settlement sum. indicating a crucial turning point in the continuing court battle.
Genesis considers this legally sanctioned settlement to be just and equitable. It tries to avoid the whirlpool of drawn-out legal proceedings, the results of which are still intrinsically speculative. The Official Committee of Unsecured Creditors of FTX was urged to contest this deal after FTX creditors expressed their displeasure.
Additionally, according to recent reports, Genesis ceased allowing consumer withdrawals from its loan division. The already turbulent environment in the cryptocurrency sector is made worse by this news.
History of the Conflict
The FTX crash in November 2022, which sent a financial shockwave through the cryptocurrency sector, serves as the setting for this courtroom drama. Due to its financial ties to FTX, Genesis found itself in a bind. It lost access to $175 million worth of cryptocurrency assets for its derivatives business.
Withdrawals were stopped in November 2022 as a result of Genesis’s financial mess, and bankruptcy papers were filed in January 2023. Sam Bankman Fried, the founder of FTX, is currently on trial for serious allegations including fraud, money laundering, and official bribery as this legal deadlock with FTX plays out.
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