As part of that bigger endeavour, FTX receives clearance for a $50 million sale of LedgerX and asserts $3.9 billion from Genesis Global Capital (GGC), the bankrupt lending arm of cryptocurrency startup Genesis.
On Thursday, bankrupt cryptocurrency exchange FTX was granted permission by a US bankruptcy court to sell its LedgerX firm for $50 million, earning additional funds to settle creditors.
US bankruptcy judge John Dorsey approved FTX’s sale of LedgerX, a non-bankrupt crypto derivatives trading platform, to an affiliate of Miami International Holdings at a hearing in Wilmington, Delaware.
The Bermuda Stock Exchange and many US-registered securities exchanges, including the Miami International Securities Exchange, are owned by Miami International Holdings.
FTX is aiming to reimburse consumers an estimated $11 billion through asset sales and clawback actions. According to the company’s April report, after declaring bankruptcy in November, FTX has recovered more than $7.3 billion in cash and liquid crypto assets.
As part of that bigger endeavour, FTX announced on Wednesday that it will pursue roughly $4 billion in payments from Genesis Global Capital (GGC), the bankrupt lending arm of cryptocurrency startup Genesis.
In a court statement, FTX stated that Genesis owed it that money as a result of transactions that occurred just before FTX’s bankruptcy declaration. Debtors can endeavour to recoup payments paid in the 90 days preceding a bankruptcy filing under US bankruptcy law so that the cash can be more equally distributed among creditors.
According to FTX, Genesis was the main “feeder fund” for FTX-affiliated hedge fund Alameda Research, lending Alameda crypto assets that it used for further loans and investments.
According to FTX, Alameda once had $8 billion in Genesis-provided loans. Unlike other creditors, Genesis was largely compensated before FTX declared bankruptcy, according to FTX.
Companies in the crypto loan market were highly interwoven during a stormy 2022, which saw several failures. FTX, a once-vibrant cryptocurrency exchange, filed for Chapter 11 bankruptcy amid charges that CEO Sam Bankman-Fried diverted FTX customers’ funds to shore up Alameda’s balance sheet.
Bankman-Fried has been charged with fraud for his involvement in the company’s demise, and he has pled not guilty. Former members of his closest circle have pleaded guilty and promised to cooperate with the investigation.
