FTX Recovery Trust sues Genesis Digital Assets for $1.15 billion
Summary
- The FTX Recovery Trust said it has filed a $1.15 billion lawsuit against Genesis Digital Assets and its co-founders.
- It said the lawsuit is based on allegations that former FTX CEO Sam Bankman-Fried mixed customer funds to buy the stake at an 'outrageously high price.'
- The FTX restructuring team is recovering customer assets and said the lawsuit could affect investors' chances of recovering their assets.
The FTX Recovery Trust has filed a $1.15 billion lawsuit against Bitcoin miner Genesis Digital Assets and its co-founders.
On the 24th (local time), Decrypt reported that the lawsuit is based on allegations that former FTX CEO Sam Bankman-Fried mixed customer funds to purchase a stake in Genesis Digital Assets at an "outrageously high price." The investment was made through FTX's sister firm Alameda Research, and at the time Bankman-Fried owned 90%.
FTX collapsed in November 2022 amid allegations of mismanagement and embezzlement, and a restructuring team led by attorney John J. Ray III is currently recovering customer assets. Bankman-Fried was convicted in November 2023 on charges that he used customer funds for Alameda Research's high-risk investments and is serving a 25-year prison sentence in a Southern California prison.
Genesis Digital Assets declined to comment on the lawsuit and is currently headquartered in Dubai, United Arab Emirates, operating data centers in the U.S. and Europe.
YM Lee
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