An FTX trust has initiated legal action against Genesis Digital Assets, seeking to recover $1.15 billion that it alleges was fraudulently transferred by Sam Bankman-Fried (SBF), the co-founder of the now-defunct cryptocurrency exchange.
The lawsuit alleges that a significant portion of the disputed funds originated from customer deposits at the FTX.com exchange. The FTX Recovery Trust contends that Bankman-Fried’s transactions with Genesis Digital were “typical examples of fraudulent transfers.”
In 2021, as Bankman-Fried orchestrated these dealings, he stood to gain significantly while risking nothing, since the shares he acquired in Genesis were ultimately held by Alameda Research, where he was a 90% owner.
The complaint outlines a series of claims under US bankruptcy law, asserting that the transfers in question should be deemed avoidable fraudulent transfers under relevant statutes.
The trust is seeking not only the recovery of the $1.15 billion but also additional amounts that may be uncovered during the discovery process. Furthermore, the lawsuit requests the reimbursement of attorneys’ fees, interest, and other costs associated with the legal proceedings
At the time of writing, the collapsed exchange’s native token, FTT, trades at $0.82, after skyrocketing above $1 last week.
Featured image from CNBC, chart from TradingView.com
