Hedge fund Modulo has agreed to repay 97% of the money that companies from Sam Bankman-Fried's bankrupt FTX cryptocurrency empire paid to it during 2022, according to a report by Reuters, citing court documents filed on Wednesday.

Hedge fund Modulo has agreed to repay 97% of the money that companies from Sam Bankman-Fried's bankrupt FTX cryptocurrency empire paid to it during 2022, according to a report by Reuters, citing court documents filed on Wednesday.

Under the terms of the deal revealed by a filing in the US bankruptcy court in Delaware, Bahamas-based Modulo will repay $404 million in cash and give up its claim to $56 million in assets held on FTX's crypto exchange. FTX and Alameda will also give up their claim to any ownership of Modulo as part of the settlement, while FTX has additionally agreed that no further action will be taken against Modulo or its principals, Xiaoyun Zhang and Duncan Rheingans-Yoo, in relation to the 2022 payments.

The court filings reveal that in a series of payment starting in May 2022 – at a time when FTX was losing money and heading towards bankruptcy – its affiliated hedge fund Alameda Research sent $475 million to Modulo at the direction of Bankman-Fried. Of that total, $25 million was to acquire a stake in Modulo, while $450 was paid to an investment fund managed by Modulo.

According to the filings, the settlement recovers most of those payments and takes 99% of Modulo’s remaining assets.