The FTX Recovery Trust filed a $1.15 billion lawsuit on Monday in a Delaware bankruptcy court, accusing Genesis Digital Assets (GDA), a Kazakhstan-based bitcoin mining firm, of receiving customer funds misappropriated by former FTX CEO Sam Bankman-Fried.
The lawsuit claims that former FTX CEO Sam Bankman-Fried used stolen customer funds from FTX’s sister company, Alameda Research, to make a massively overpriced $1.15 billion investment in Genesis Digital Assets just before FTX collapsed in 2022.
According to the trust, $550 million of the $1.15 billion investment went directly to GDA co-founders Rashit Makhat and Marco Krohn, leaving FTX creditors empty-handed. The trust is seeking a court order to recover the full amount, plus interest, to repay defrauded customers. No hearing date has been set as of now.
The FTX Recovery Trust wants a court order to recover the $1.15 billion, plus interest, to repay defrauded FTX customers. However, no hearing date is set, but with billions at stake, pressure on GDA continues.
Legal experts say the FTX lawsuit against Genesis Digital Assets reveals how FTX’s risky overseas deals, enabled by a lack of transparency, fueled its collapse. A bankruptcy lawyer, speaking anonymously, said this wasn’t just one bad investment but part of a larger pattern.
In November 2022, FTX, a major crypto platform with strong Washington connections, went bankrupt after it was revealed that Sam Bankman-Fried misused about $8 billion of customer funds to support risky investments through Alameda Research.
Convicted of fraud, he was sentenced to 25 years in prison in 2024, and the trust is still working to recover funds for affected customers. Recently, on September 20, 2025, FTX announced that it will distribute $1.6 billion to its creditors on September 30, 2025.