Genesis-Parent DCG Agrees to Settle Creditors' Claims
Earlier this year in January 2023, Genesis filed for Chapter 11 bankruptcy after facing a major liquidity crisis following the collapse of crypto exchange FTX. The recent filing from Genesis parent DCG notes that the bankrupt crypto lender holds liabilities of $630 million in unsecured loans due in May 2023. Additionally, it also has a $1.1 billion unsecured promissory note due in 2032.
As per the in-principle deal, the Digital Currency Group (DCG) is looking to undertake new debt facilities along with a repayment agreement. This will include a $328.8 million first-lien facility along with 2-year maturity. Additionally, it will also include a $830 million second-lien facility with a 7-year maturity.
The filing notes that DCG is planning to pay a total of $275 million to its creditors in four installment payments. If executed, the proposed plan could lead to anticipated returns of approximately 70% to 90% for unsecured creditors in terms of U.S. dollars, and a recovery range of 65% to 90% in-kind based on the denomination of the digital asset, as stated in the filing.
Will Gemini Benefit From Genesis Settlement?
Following the bankruptcy of Genesis, crypto exchange Gemini has suffered the most as Genesis was the custodian of Gemini’s Earn Product. As per Gemini, Genesis owes them close to $1 billion as part of its customers’ funds.
Recommended Articles
Crypto Presale Projects For 2023 To Invest; Updated List
Must Read
Best Crypto Trading Bots List 2023
Must Read
Top Crypto Marketing Firms / Agencies 2023; Here’s Best Picks [Updated]
Must Read
Crypto Telegram Channels List 2023 [Updated]
Must Read
Top 10 Web3 Games To Explore In 2023; Here List
Must ReadOn refusal to give back the funds, crypto exchange Gemini also filed a lawsuit against Genesis-parent DCG. However, DCG has filed a motion to dismiss the lawsuit stating that the lawsuit is “a continuation of the Winklevoss’s year-long Twitter-based character assassination.”
It’s not clear whether the current settlement plan will involve some partial refunds to Gemini. Genesis has outstanding debts of approximately $3.6 billion to its top 50 creditors. This also includes obligations to entities like Gemini, the cryptocurrency exchange established by the Winklevoss twins.