Both companies are asking the court to pause upcoming deadlines related to current motions and briefs.
In a promising development, cryptocurrency exchange FTX and crypto lender Genesis, both grappling with bankruptcy, have expressed a tentative consensus to settle the claims made in FTX's ongoing bankruptcy case.
A letter was submitted to Judge Sean Lane on July 27th by the legal teams representing both Genesis and FTX, revealing that a preliminary agreement for a settlement had been reached.
Did you know?
Want to get smarter & wealthier with crypto?
Subscribe - We publish new crypto explainer videos every week!
4 Ways to Turn Fiat to Crypto VS Crypto to Fiat (Easily Explained)
It is worth noting that under the guidance of the court, both Genesis and FTX are currently in bankruptcy and have been making efforts to recoup funds to repay their respective creditors.
The proposed settlement is set to address and resolve the mutual claims made by FTX and Genesis against each other. Furthermore, it plans to remove any pending legal actions associated with these claims.
Both companies are seeking prompt court approval for this settlement. In the letter, legal representatives stated:
The Parties have reached an agreement in principle, subject to documentation, regarding a settlement that would resolve, among other things, the claims asserted by the FTX Debtors against the Debtors in these Chapter 11 Cases and the claims asserted by the Genesis Debtors against the FTX Debtors in the FTX Chapter 11 Cases.
Both parties requested the court to postpone upcoming deadlines relating to current motions and briefs, allowing for additional time to finalize the terms of their settlement agreement.
FTX previously alleged that Genesis had accumulated debts towards FTX that initially totaled an astonishing $4 billion. However, this figure eventually decreased to $2 billion, as revealed in a letter to Judge Lane.
Court documents indicate that Genesis is the primary unsecured creditor of FTX, with an outstanding debt of $226 million.
The provisional agreement between FTX and Genesis marks a crucial development in their entangled bankruptcy saga. It underscores their shared commitment to resolving their financial differences to their creditors' advantage.
