DCG files objection in bankruptcy court, calls out Genesis’ settlement subversive 😮📢

Digital Currency Group Opposes Settlement in Genesis Bankruptcy Case

Digital Currency Group (DCG) has filed an application opposing the settlement reached between the New York Attorney General and Genesis, a bankrupt crypto lender that is affiliated with DCG. While Genesis had previously struck a deal with the attorney general’s office to drop charges of defrauding investors, DCG argues that this settlement is improper. According to DCG, the agreement allows Genesis to take value from lower-class investors and redistribute it to preferred creditors, which goes against bankruptcy laws.

DCG’s Concerns

DCG claims that the settlement is a back-door attempt to circumvent U.S. bankruptcy law.
The company characterizes the arrangement as subversive and put together last-minute and in secret.

Prior to this development, the Bankruptcy Court had granted Genesis Global Holdco’s request to sell 35 million GBTC owned by the lending platform. The sale was intended to satisfy creditors’ claims amounting to over $1.3 billion. Digital Currency Group attempted to delay the proposed deal until the court decided on the debt repayment plan’s approval. However, if rejected, DCG would not be opposed to the sale of trusts.

Genesis’ Lawsuit Against DCG

In September 2023, Genesis filed a lawsuit against DCG, seeking repayment of $620 million in loans.
DCG later announced satisfaction of its obligations to creditors and payment of approximately $700 million in favor of the lending platform.

Hot Take: DCG Raises Concerns About Improper Settlement in Genesis Bankruptcy Case

In a recent development concerning the Genesis bankruptcy case, Digital Currency Group (DCG) has expressed its opposition to the settlement reached between Genesis and the New York Attorney General. DCG argues that the agreement allows Genesis to take value from lower-class investors and redistribute it to preferred creditors, which is against bankruptcy laws. The company further criticizes the settlement as a subversive arrangement put together secretly at the last minute. DCG’s concerns highlight the need for proper adherence to bankruptcy laws and fair treatment of investors.