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<p>The post <a href="https://coinpedia.org/news/court-approves-genesis-globals-3-billion-repayment-plan-overruling-dcg-challenge/">Court Approves Genesis Global’s $3 Billion Repayment Plan, Overruling DCG Challenge</a> appeared first on <a href="https://coinpedia.org">Coinpedia Fintech News</a></p> 
<p>Genesis Global Capital has been granted court <a href="https://www.courtlistener.com/docket/66744636/genesis-global-holdco-llc/?page=10" target="_blank" rel="noreferrer noopener">approval</a> to distribute billions in digital assets and cash to creditors. Judge Sean Lane’s decision overruled a legal challenge from its parent company, Digital Currency Group (DCG). This ruling clears the path for Genesis to return customer assets frozen since November 2022.</p> 
<h2 class="wp-block-heading" id="h-genesis-chapter-11-repayment-plan-confirmed"><strong>Genesis Chapter 11 Repayment Plan Confirmed</strong></h2> 
<p>More than a year after <a href="https://coinpedia.org/news/big-breaking-genesis-global-capital-files-for-bankruptcy-is-crypto-space-ready-for-the-impact/" target="_blank" rel="noreferrer noopener">Genesis Global Capital filed for bankruptcy</a>, the failed company’s Chapter 11 repayment plan finally received judicial approval on Friday, May 17th.&nbsp;</p> 
<p>Judge Sean Lane approved and signed the plan’s unique structure for returning Bitcoin and other cryptocurrencies to creditors. Genesis’ creditors and customers of the Gemini Earn program, had also garnered huge support for the repayment plan a lending initiative run jointly with Gemini Trust Co., founded by the Winklevoss brothers.&nbsp;</p> 
<p>The repayment plan, however, did not go without arguments and opposition.&nbsp;</p> 
<h2 class="wp-block-heading" id="h-opposition-from-parent-company"><strong>Opposition from Parent Company</strong></h2> 
<p>Genesis’ parent company, Digital Currency Group, contested the repayment plan, arguing that the increase in crypto prices should not benefit creditors at its expense. For example, Bitcoin’s current price (at the time of writing) is $66,922, but at the time of Genesis’ bankruptcy filing, Bitcoin was valued at around $24,000, significantly lower than its current price.&nbsp;</p> 
<p>DCG argued that creditor claims should be based on cryptocurrency prices at the time of Genesis’ bankruptcy filing in early 2023. The repayment plan resulted in an “impermissible windfall” for creditors, and claims should be calculated based on the value of crypto assets in January 2023.&nbsp;</p> 
<p>Nonetheless, Genesis’ attorney, Sean O’Neal, dismissed this notion, stating, “We don’t buy into the idea that claims are capped at the petition date value.” Judge Lane rejected DCG’s objection, stating that the parent company has no legal right to challenge Genesis’ Chapter 11 plan.&nbsp;</p> 
<p>In his order, J. Lane wrote, “Given the size of the creditor claims, DCG is out of the money as an equity holder by billions of dollars.” As per the liquidation proceedings, DCG, as an equity holder, stands last in line for repayment, and whatever value Genesis had is first to be paid back to the creditors.</p> 
<p>Therefore, as per the approved plan, Genesis’ creditors can recover up to 77% of their claims.&nbsp;</p> 
<h2 class="wp-block-heading" id="h-settlements-for-gemini-earn-program"><strong>Settlements for Gemini Earn Program</strong></h2> 
<p>A related settlement with New York Attorney General Letitia James was also approved by Judge Lane, who had sued Genesis’ Gemini Earn program. The settlement ensures that the former Earm customers wil have assets redirected to their wallets which were potentially owed to state authorities.&nbsp;</p> 
<p>Additionally, a previous Gemini Earn Program settlement with the US Securities and Exchange Commission as also confirmed, concluding another legal challenge faced by Genesis.</p> 
<h2 class="wp-block-heading" id="h-all-in-all"><strong>All in all..</strong></h2> 
<p>The court’s decision to approve Genesis’ Chapter 11 plan has sanctioned the distribution of approximately $3 billion in cash and cryptocurrency to the failed company’s creditors as well as the Gemini Earn program customers. Meanwhile, the parent company DCG, is yet to recover from the bankruptcy, as its claims are subordinate to those of Genesis’ creditors.</p> 
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Court Approves Genesis Global’s $3 Billion Repayment Plan, Overruling DCG Challenge

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