Genesis Global Holdco LLC and FTX have reached an in-principle agreement to settle a dispute relating to their respective Chapter 11 bankruptcy cases, which is a huge step forward for the cryptocurrency and financial industries. The agreement is a significant development toward resolving the conflict and opening up new opportunities for both parties.
Previously, FTX made claims that Genesis owed them up to $3.9 billion in digital currency which were refuted by Genesis, a lender of digital currency. After some time, it was eventually reduced to a total of $2 billion.
However, their legal representatives stated in a letter that was sent on Thursday to a judge overseeing the bankruptcy case that the agreement would result in the two parties claims against each other being resolved.
They intend to petition the bankruptcy courts to sanction the transaction. Not all of the details of the in-principle agreement have been made public just yet, but those familiar with the situation say it provides a framework for dealing with the problems and obligations that FTX and Genesis still have to face.
In order to emerge from bankruptcy in a stronger and more sustainable position, the companies are hoping that the agreement will pave the way for a comprehensive restructuring plan. Many of Genesis’ creditors, who feared the dispute would slow down bankruptcy and the payout of claims, will likely breathe a sigh of relief at the news of the settlement.
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