Genesis seeks court's approval to reduce 3AC claim from $1B to $33M
Bankrupt cryptocurrency lender Genesis has asked the court to approve its proposed settlement agreement with the imploded crypto hedge fund Three Arrows Capital (3AC).
According to a court filing on Nov. 9, Genesis argued that the 3AC debtor should receive an allowed general unsecured claim against Genesis in the amount of $33 million. The amount accounts for 3.3% of $1 billion in claims originally asserted against Genesis debtors.
“Agreement provides that the 3AC debtor shall receive an allowed general unsecured claim against GGC in the amount of $33 million in full and complete satisfaction of the more than $1 billion dollars in claims asserted against each of the Genesis debtors,” the document reads.
According to Genesis, 3AC’s $1 billion claims against Genesis were the largest asserted claims in Chapter 11 cases associated with the collapse of the FTX exchange. Genesis stressed that 3AC Debtor was one of Genesis’s largest borrowers from 2020 to 2022, up until the time of its collapse.
Additionally, Genesis wants to relinquish all of its claims and entitlements to Avalanche (AVAX) tokens and Near Protocol (NEAR) tokens in favor of the 3AC debtor. The bankrupt firms should drop any remaining liabilities, the proposed settlement reads, stating:
The lender said that the settlement was necessary to provide a smooth path for its Chapter 11 reorganization plans and to reduce potential risks and expenses from litigation.
Related: Court confirms Celsius bankruptcy exit plan, $2B in crypto to go to creditors
“The proposed settlement will, among other benefits to the Genesis debtors’ estates, significantly smooth the path to confirmation of the Genesis debtors’ Chapter 11 plan of reorganization, prompt distributions
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