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FTX 2.0 Coalition: FTX Seeks Court Resolution for Genesis Claim Dispute and Resolves $175 Million Cu

WikiBit 2023-08-18 14:17

Abstract:FTX 2.0 Coalition: FTX Seeks Court Resolution for Genesis Claim Dispute and Resolves $175 Million Customer Claims

The FTX 2.0 Coalition, representing FTX creditors, has stated on Twitter that FTX is seeking a court resolution to settle a $175 million claim dispute with Genesis, waive $175 million in customer claims, and address the nearly worthless Alameda claim. The claim amount has decreased from an initial $3.9 billion to $2 billion, making it undoubtedly one of the most unfavorable deals to date, particularly considering the ongoing Department of Justice investigation into DCG and Genesis.

Even though Genesis' claim amount remains higher than FTX's claim amount, the balance of Genesis' loan has inflated due to interest earned from loans to Alameda and others.

In 2022, Alameda used billions of FTX customer funds to repay Genesis. The crypto assets they hold can be directly traced back to FTX customer deposits. It is expected that the UCC will oppose this “transaction.”

Earlier on August 5th, according to Bloomberg's sources, the office of New York Attorney General Letitia James requested information from former executives of cryptocurrency lending firm Genesis. Michael Patchen, former Chief Risk Officer of Genesis, has recently been questioned. Federal prosecutors and the U.S. Securities and Exchange Commission (SEC) have initiated investigations and sought interviews with potential witnesses from Genesis and its parent company DCG. A spokesperson for DCG stated that the company is cooperating with regulatory and investigative agencies as requested.

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