Genesis Lender’s $600M Payment Default Sends Shockwaves
Genesis, a bankrupt crypto lender, has filed a motion to prolong the exclusive period for its reorganization plan by an additional 100 days.
According to a court filing on May 19, Genesis stated that it required the extension to ensure an optimal restructuring process without the interference of competing plans.
Genesis argued that the complexity and magnitude of its case warranted the court’s approval of the extension. The lender’s financial statements reveal substantial assets and liabilities that need to be restructured.
Additionally, Genesis emphasized that the evolving regulatory framework surrounding digital assets necessitates careful consideration within its case.
The lender further asserted that its request should be granted due to the progress it has made in good faith towards emerging from bankruptcy, with the extension neither disadvantaging nor pressuring creditors or other concerned parties.
If the request is approved, Genesis will have until August 27 to submit a plan, while the exclusive solicitation period will be extended until October 26.
Gemini reports missed payment by DCG Meanwhile, Gemini, a cryptocurrency exchange, disclosed that Digital Currency Group (DCG), the parent company of the bankrupt lender, failed to make a $630 million payment to its subsidiary last week.
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DCG was one of the many crypto firms affected by the market downturn in 2022 and currently owes approximately $1.7 billion to Genesis, its lending subsidiary.
In an Earn update on May 19, Gemini stated that it was considering granting forbearance to prevent a default by DCG. The exchange added that its decision would depend on whether “the parties believe DCG will engage in good faith negotiations on a consensual deal.”
If an agreement cannot be reached, Gemini expressed its willingness to collaborate with Genesis in proposing terms for an amended reorganization plan that does not require DCG’s consensual participation. This situation prompted Genesis to request an extension of its exclusivity period on May 19.
Gemini also announced its intention to file a Master Claim on May 22, seeking the return of $1.1 billion worth of crypto assets for its 232,000 Earn users.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
