Genesis Global, a well-known crypto lending company, and its parent company, Digital Currency Group (DCG), have successfully resolved their financial issues by reaching an agreement with their creditors. This latest update indicates that both entities have managed to navigate through their financial challenges.
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Genesis Global and DCG make deal with creditors for 90% recovery. The Path To Recovery For Creditors
Recent court filings reveal that an agreement has been reached which could potentially allow stakeholders to recover their investments. Genesis Global and Digital Currency Group's announcement brings hope to creditors, with unsecured creditors expected to recover a significant portion of their claims. Those holding claims in US dollars could see a recovery rate between 70% to 90%, while those with claims in specific digital assets are anticipated to recover between 65% to 90%. The agreement settles approximately $630 million in unsecured loans, due in May 2023, and a roughly $1.1 billion unsecured promissory note, expected in 2032. Genesis Global and DCG make deal with creditors for 90% recovery.
DCG’s Position And Broader Implications
DCG’s response to the entire episode is relief and forward-looking optimism. In a statement issued to Reuters, DCG expressed its satisfaction, stating:
DCG is pleased to reach an agreement in principle with Genesis and the Unsecured Creditors Committee, which will provide a framework for a comprehensive resolution of the claims in the Genesis Chapter 11 cases and a pathway to significant recovery for creditors.
In January, Genesis faced financial difficulties and filed for bankruptcy with liabilities of around $3.4 billion. However, in February, they reached an agreement with DCG and primary creditors, including Gemini, to restructure the company. Meanwhile, DCG is attempting to dismiss a lawsuit filed by Gemini related to the "Earn Program" debacle that occurred with Genesis. DCG and CEO Barry Silbert have petitioned Judge Lewis Liman to dismiss the case, citing the Federal Rules of Civil Procedure and arguing that Gemini has not provided substantial evidence to support their fraud allegations. Genesis had previously collaborated with Gemini on the "Earn Program" before the controversy arose when users were unable to access their funds after the bankruptcy.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.