FTX, Genesis To Settle Dispute In Cases Involving Bankruptcy

According to their legal representatives, FTX Trading and Genesis Global Holdco have come to an agreement in principle to resolve a dispute related to their bankruptcy protection cases.

The lawyers submitted a letter to a bankruptcy judge on Thursday, stating that they plan to promptly document the settlement and file a motion to approve it in their respective courts.

The details of the settlement were not disclosed in the letter.

FTX Trading had previously claimed that Genesis owed them up to $2 billion, which could have caused delays in Genesis’s own court proceedings, as reported by Bloomberg earlier this month.

Last January, Genesis filed for Chapter 11 bankruptcy protection in a New York federal bankruptcy court.

This was due to financial losses it incurred following the collapse of Three Arrows Capital and FTX, two crypto hedge funds.

Genesis has outstanding debts amounting to approximately $3.6 billion to its top 50 creditors, which include claims from Gemini, the crypto exchange co-founded by the Winklevoss twins.

Gemini and Genesis, two financial companies, have filed motions to dismiss a lawsuit filed by the Securities and Exchange Commission earlier this year.

The SEC had accused the companies of violating U.S. law by conducting an unregistered sale of securities through the Earn program. However, in a recent court filing, Genesis argued that Earn involved loans, not securities, and that the SEC had not provided sufficient evidence to prove otherwise.

Similarly, Gemini also argued that the SEC was attempting to portray the Earn program as the sale of unregistered securities, which was not the case.

It is not surprising that the companies are trying to dismiss the lawsuit, as they had previously stated their intention to fight it.

Back in January, Gemini co-founder Tyler Winklevoss tweeted that “We look forward to defending ourselves against this manufactured parking ticket.”