Cryptocurrency exchange FTX is attempting to recover about $4 billion from cryptocurrency lender Genesis, which is also bankrupt, and from a British Virgin Islands-based entity that is still solvent, as part of efforts to recover value for investors. creditors.
In a brief filed May 3 with the New York Bankruptcy Court, a group of FTX lawyers were requesting $1.8 billion in loans and a $273 million guarantee, money allegedly provided to Genesis by Alameda Research, FTX’s sister company.
FTX is also seeking to recover $1.6 billion in withdrawals allegedly made by Genesis and another $213 million allegedly withdrawn by its British Virgin Islands-based entity GGC International before it filed for Chapter 11 bankruptcy on September 11. November.
FTX moves to claw back $3.9 billion from Genesis.
1. $2.1 billion loan repayments/collateral pledge
2. $1.8 billion FTX exchange withdrawals pic.twitter.com/1SsW8yoPck— FTX 2.0 shareholder (in spe) (@AFTXcreditor) May 3, 2023
The filing claims Genesis was “repaid in large part” of its nearly $8 billion in loans made to Alameda, “unlike other FTX creditors and customers.”
FTX claimed that the bankrupt lender was “one of FTX’s main feeder funds and critical to its fraudulent business model.”
The exchange’s lawyers are requesting a refund under bankruptcy law, which allows recovery of “avoidable transfers” that occur in a 90-day period before a company files for bankruptcy.
FTX’s previous returns have centered on $3.2 billion in payments made to its former executives, a $460 million investment made by Alameda in venture capital firm Modulo Capital, and some $93 million in political donations made by founder Sam Bankman-Fried and other former top executives.
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