Crypto:
30188
Bitcoin:
$69.036
% 2.83
BTC Dominance:
%54.4
% 0.13
Market Cap:
$2.44 T
% 3.67
Fear & Greed:
74 / 100
Bitcoin:
$ 69.036
BTC Dominance:
% 54.4
Market Cap:
$2.44 T

Gemini Will Start Refunding Customers’ Crypto by the End of the Month

Gemini Exchange

The US Bankruptcy court has approved failed crypto lender Genesis’ Chapter 11 bankruptcy plan, marking a significant step in the company’s restructuring. This approval is expected to lead to significant losses for its parent company, Digital Currency Group (DCG).

Gemini, one of Genesis’ creditors, announced that it would begin returning 97% of the assets owed in kind to customers of its now-defunct Gemini Earn program by the end of the month.

Genesis, which went bankrupt following the collapse of the Terra/Luna ecosystem and Three Arrows Capital, received court approval for its bankruptcy plan yesterday. The judge rejected the objections of Genesis owner DCG.

BASIS. Judge Sean Lane rejected DCG, Genesis Crypto Creditors Ad Hoc Group and the United States Trustee’s objections to rulings in favor of the plan. This plan aims to return approximately $3 billion in cash and assets to creditors.

DCG argued that the claims should be assessed in US dollars based on the company’s January 2023 bankruptcy filing date, ignoring nearly 18 months of gains in the crypto market. However, Judge Lane rejected this argument, stating: “DCG objected to a plan in which it had no economic interest. The record makes clear that there was insufficient value in the Debtors’ properties to provide DCG with an interest in the recovery.” “Unsecured creditors are being paid.”

The approved plan includes a multi-step process to allocate assets to creditors based on claim denominations, distinguishing between cryptocurrency owed and US dollars owed. Due to the increase in the price of digital assets since the decision was reached, U.S. dollar creditors are expected to receive 100% of their loan balances by deferring post-petition interest payments, Judge Lane said. In contrast, creditors claiming cryptocurrency will face a shortfall.

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DCG may consider appealing the decisions, but Bloomberg reported that it is unclear what legal basis this would have, given the significant shortfall in assets.


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