Genesis and Digital Currency Group Reach Agreement in Ongoing Lawsuit
Bankrupt crypto lender Genesis and its parent company, Digital Currency Group (DCG), have reached an agreement that could potentially resolve an ongoing lawsuit. The lawsuit sought to recover $620 million in repayments from DCG.
The Repayment Deal
In a recent filing to a New York Bankruptcy Court, Genesis announced that DCG has agreed to pay off its outstanding $324.5 million in loans by April of next year. Additionally, Genesis will have the ability to pursue any unpaid amounts.
Avoiding Litigation
The proposed deal is designed to allow Genesis to end the lawsuit it filed against DCG in September. The lawsuit aimed to reclaim overdue loans totaling approximately $620 million. While DCG has made some payments since the suit, this agreement would provide immediate benefits and avoid the need for litigation.
Creditor Approval and Bankruptcy Proceedings
If approved, this repayment deal will be part of Genesis’ plan to repay its creditors. The plan will be voted on by the creditors before being presented to bankruptcy judge Sean Lean for a decision. The judge will take into account the votes of the creditors.
Additional Lawsuits and Allegations
In addition to the ongoing lawsuit with DCG, Genesis has also sued crypto exchange Gemini, seeking to recover nearly $670 million in transfers. Furthermore, both Genesis and Gemini are facing a lawsuit from the Securities and Exchange Commission (SEC) for allegedly selling unregistered securities. The state of New York has also sued the two companies along with DCG, accusing them of defrauding investors.
Genesis’ Bankruptcy Filing
Genesis filed for bankruptcy in January after suspending withdrawals in November 2022.
Hot Take: Genesis and DCG Resolve Lawsuit with Repayment Deal
Genesis and its parent company, Digital Currency Group (DCG), have reached an agreement that could bring an end to their ongoing lawsuit. The deal involves DCG repaying Genesis’ outstanding loans, totaling $324.5 million, by April of next year. This resolution aims to provide immediate benefits to Genesis and avoid the need for litigation, saving both parties time and resources. However, Genesis still faces other legal challenges, including lawsuits with crypto exchange Gemini and allegations of selling unregistered securities by the SEC. With bankruptcy proceedings ongoing, the repayment deal will be subject to creditor approval before a final decision is made by the bankruptcy judge.
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