Chapter 11 crypto exchange sues Bitcoin mining giant for $1.15 billion fraud

Core Points - The FTX Recovery Trust has initiated legal action against Genesis Digital Assets to reclaim $1.15 billion, alleging fraudulent transfers by Sam Bankman-Fried [1][2] - The complaint highlights that SBF misappropriated customer deposits from FTX and transferred them to Genesis Digital and its affiliates [2] - Genesis Digital's operations were significantly impacted by political changes and regulatory challenges in Kazakhstan, where it had previously benefited from low energy costs [3][4] Group 1 - The FTX Trust claims that SBF commingled and misappropriated assets, transferring funds to Genesis Digital and its co-founders [2] - The complaint was filed in the U.S. Bankruptcy Court for the District of Delaware on September 22 [2] - Genesis Digital's founders allegedly cashed out $550.9 million from Alameda Research after SBF's investment [6] Group 2 - The trust alleges that SBF's investment in Genesis Digital was made at "outrageously inflated prices" and did not provide a reasonable equivalent value [4][5] - There were several red flags regarding Genesis Digital, including lack of investor interest and unaudited financial records, which SBF reportedly ignored [5] - The complaint characterizes Genesis Digital as one of SBF's most reckless investments, involving misappropriated funds [7]