Bankrupt crypto derivatives exchange platform FTX has reached a deal with the Bahamas-based hedge fund Modulo Capital to recover $404 million in cash along with the agreement that it will give up its claim to the $56 million in assets held on FTX's CEX.

It's a good day for the FTX estate since it has made an impressive success in coming into agreement with Modulo Capital after it filed a motion to recoup $460 million in assets from the hedge fund, which includes $404 million in cash, an amount representing more than 99% of the company's remaining assets.

A filing in the U.S. bankruptcy court in Delaware relating to the agreement also detailed that Modulo Capital agreed to relinquish any claims to the $56 million in assets held in FTX and FTX US accounts with the remaining $404 million in assets converted into cash at J.P. Morgan.

The move was believed to be made to avoid the long process of pursuing the claims through litigation.

The ability of the new FTX executives to secure this massive payback of $460 million via negotiations with key people at Modulo Capital would prove helpful in recovering the now-bankrupt crypto empire's financial health.

So far, the team has seized approximately $700 million from Sam Bankman-Fried, the founder and former CEO of FTX. The bankruptcy estate can now move on to other investments to recover the company's billions of dollars worth of funds.

Modulo Capital gained notoriety in the crypto space when FTX imploded and investigations led to the Bahamas-based hedge fund's doorstep. In an article earlier this year, The New York Times described the business as the "unknown hedge fund that got $400 million" from Bankman-Fried.

The firm has neither a track record nor a public profile and was run by its founder Duncan Rheingans-Yoo, who reportedly finished college just a couple of years ago.

Interestingly, the outlet, citing four people with knowledge of the relationship, revealed that Xiaoyun Zhang, who uses the name "Lily" and was Rheingans-Yoo's business partner, was romantically involved with Bankman-Fried in the past.

The controversial crypto kingpin allegedly met Lily during his stint at Jane Street Capital, a trading firm where his other former lover and former CEO of the crypto hedge fund Alameda Research, previously worked.

The name Modulo Capital emerged last year following the disclosure made by the Bahamian prosecutor of their knowledge of the existence of the said hedge fund after Bankman-Fried's bail hearing in the Bahamas and days before he was extradited to the United States.

Former FTX Chief Executive Sam Bankman-Fried, who faces fraud charges over the collapse of the bankrupt cryptocurrency exchange, leaves his court hearing at a federal court in New York