Genesis, the parent company of Genesis Global Holdco LLC, has received court approval to distribute $3 billion in cash and crypto assets to its creditors. This payout covers approximately 77% of the total value of customer claims. Notably, Digital Currency Group (DCG) will not be among the entities receiving payments.
Genesis and its subsidiaries filed for Chapter 11 bankruptcy protection in New York in January 2023, following significant losses from the collapses of Three Arrows Capital and FTX. At the time, over $3.5 billion was owed to the company's top 50 creditors. Initially, there were doubts about customers being reimbursed fully and the promptness of the bankruptcy proceedings.
Since then, Genesis claims have seen fluctuations. Bitcoin or ether claims above $10 million are trading between 97-110%, while smaller claims under $1 million range from 74-94%. Fiat currency or stablecoin claims are trading between 89-91% for accounts valued between $1-10 million and 73-88% for claims under $1 million.
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Judge Sean Lane stated in the filing that DCG, Genesis's parent company, will not be receiving payouts as an equity holder due to insufficient value in the company's estates after paying unsecured creditors. Despite DCG's proposal to cap customer claims at the value of cryptocurrencies as of January 2023, it was deemed unfeasible. DCG had assumed $1.1 billion of Genesis's debt from the Three Arrows Capital collapse with a 10-year promissory note, but this did not cover the losses, leading to scrutiny of DCG's financial practices.
DCG and Genesis reached a repayment plan in November 2023, with DCG having paid $227.3 million so far and committing to another $275 million by April. This settlement resolves a lawsuit over $620 million in loans, reflecting ongoing efforts to address financial obligations and legal disputes between the two companies.
Genesis seeks court approval to liquidate $1.6 billion in Grayscale Trust assets amidst bankruptcy, aiming to mitigate risks and maximize creditor returns amid market volatility.
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JinseFinanceThe current offer would mean selling the company to Farenheit Consortium, and customers getting between 67-85% of their money back.
ClementBankrupt crypto broker Genesis has filed details on how it will pay back its creditors.
decryptEarlier Monday, CoinDesk reported that DCG and Genesis had reached an agreement with a key group of creditors.
OthersGenesis creditors are cautiously optimistic that they will soon reach consensus with the lender to reimburse at least $3.4 billion in frozen customers.
BeincryptoBankruptcy may be inevitable if a bailout cannot be secured.
BeincryptoSeparately, the CEO of Genesis' parent company disclosed that it had a roughly $575 million liability to Genesis.
CoindeskThe troubled crypto investment bank is in talks with potential investors for at least $1 billion in fresh capital, according to a Bloomberg report.
CoindeskGenesis has spent the past several days seeking at least US$1 billion (S$1.4 billion) in fresh capital.
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