Gemini

Read

<p class="is-style-lead">Genesis Global Capital, the now bankrupt lending arm of Digital Currency Group (DCG), has failed to pay approximately $630 million due to creditors, leading to discussions among stakeholders about a potential default. </p>



<p class="is-style-default">The situation highlights the challenges faced by the crypto industry and raises questions about the financial stability of other companies, including those affected by the FTX collapse.</p>



<h2 class="wp-block-heading" id="dcg-8217-s-non-payment-and-consideration">DCG&#8217;s non-payment and consideration&nbsp;</h2>



<p>Digital Currency Group, the parent company of Genesis Global Capital, has not fulfilled its obligation to pay around $630 million, which was due last week.</p>



<p>This development has prompted discussions among <a href="https://crypto.news/genesis-global-files-for-bankruptcy/">Genesis</a>, the Unsecured Creditors Committee (UCC), the Ad Hoc Group of Creditors (AHG), and Gemini, regarding potential forbearance options to prevent a default by DCG.&nbsp;</p>



<p>The decision on whether to provide forbearance will be influenced by the parties&#8217; assessment of DCG&#8217;s willingness to engage in good-faith negotiations for a consensual deal.</p>



<div class="cn-block-related-link">

    <svg class="cn-block-related-link__icon icon" aria-hidden="true">
        <use xlink:href="#icon-bookmark"></use>
    </svg>

    
        <span class="cn-block-related-link__prefix">
            You might also like:
        </span>

    
    
        <a href="https://crypto.news/gemini-enters-mediation-hopes-to-quickly-resolve-dcg-dispute/" class="cn-block-related-link__link">
            Gemini enters mediation, hopes to quickly resolve the DCG dispute        </a>

    
</div>


<h2 class="wp-block-heading" id="pursuit-of-alternative-solutions-and-gemini-8217-s-claims">Pursuit of alternative solutions and Gemini&#8217;s claims</h2>



<p>If a consensual deal cannot be reached, Gemini and other parties involved are <a href="https://www.gemini.com/earn" target="_blank" rel="noopener">working</a> closely with Genesis to propose an amended plan of reorganization that does not rely on DCG&#8217;s participation, the team says.&nbsp;</p>



<p><a href="https://crypto.news/genesis-sues-roger-ver-for-20-9-million-over-unsettled-crypto-options/">Genesis</a> has already filed a motion with the bankruptcy court to extend its exclusivity period, seeking the opportunity to propose such a plan. Gemini, being an affected party, is actively providing input and support for this alternative approach.</p>



<p>Additionally, Gemini has been preparing the Gemini Master Claim, which is scheduled for filing on May 22, 2023. The claim seeks the return of over $1.1 billion worth of digital assets that Genesis has failed to refund approximately 232,000 Earn users who had active loans as of Jan. 19, 2023.</p>



<h2 class="wp-block-heading" id="ftx-contagion">FTX contagion&nbsp;</h2>



<p>The recent failure of Genesis Global Capital to meet its financial obligations is intertwined with the aftermath of the collapse of the disgraced Sam Bankman-Fried’s FTX crypto exchange.&nbsp;</p>



<p>Gemini, as a major client of FTX, has <a href="https://crypto.news/genesis-yet-to-enable-customer-withdrawals-amid-ftx-contagion/">experienced disruptions</a> in its operations, ultimately freezing its services in November. </p>



<p>Genesis Global Holdco, the parent company of Genesis Global Capital, subsequently filed for Chapter 11 bankruptcy protection in New York federal district court.</p>



<figure class="wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio"><div class="wp-block-embed__wrapper">
<iframe title="Crypto lender Genesis files for bankruptcy" width="1020" height="574" src="https://www.youtube.com/embed/xPGmVXEKzvQ?feature=oembed" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen></iframe>
</div></figure>



<p>The collapse of <a href="https://crypto.news/ftx-seeks-to-reclaim-over-240m-in-controversial-acquisition-of-embed/">FTX</a> had far-reaching consequences, leading to the bankruptcy or financial distress of multiple crypto industry players.&nbsp;</p>



<p>Established bitcoin (<a href="https://crypto.news/bitcoin-price/">BTC</a>) linked businesses such as <a href="https://crypto.news/celsius-transfers-772m-in-steth-from-lido-amid-withdrawal-enablement/">Celsius</a>, Voyager Digital, BlockFi, and Genesis Global Capital, along with hedge fund Three Arrows Capital (3AC), were among those impacted by the collapse. </p>



<p>This series of events has left investors, ranging from small traders to financial institutions, at the mercy of bankruptcy proceedings and has raised concerns about the stability of the crypto lending ecosystem.</p>



<p>As the situation unfolds, investors and industry participants will be closely monitoring the outcome, hoping for a fair and equitable resolution to protect the interests of all parties involved.</p>



<div class="cn-block-related-link">

    <svg class="cn-block-related-link__icon icon" aria-hidden="true">
        <use xlink:href="#icon-bookmark"></use>
    </svg>

    
        <span class="cn-block-related-link__prefix">
            Read more:
        </span>

    
    
        <a href="https://crypto.news/genesis-creditors-negotiating-prepackaged-bankruptcy/" class="cn-block-related-link__link">
            Genesis creditors negotiating prepackaged bankruptcy        </a>

    
</div>

Digital Currency Group’s failure to pay $630m raises concerns

Table of Contents

crypto.news

Other articles published on May 22, 2023

CoinPaprika lists Pepe Monsta (MEPE)

Big Altcoin Portfolio Change For Big Gains

New Frontier Presents Prepares for Apple's New Headset Release: How to Get Involved in the XR Met...

Bitmex Introduces Exclusive Virtual Asset Service for Hong Kong Users Before Acquiring VASP License

Babylon Booster Grants: Kickstart Your dApp on the Radix Babylon Mainnet Upgrade

What Is the Binance Wallet?

Join our free newsletter for daily crypto updates!