Genesis Global Capital Seeks to Liquidate Grayscale Trust Holdings
Genesis Global Capital, a crypto lending firm currently undergoing bankruptcy proceedings, has filed a petition with the U.S. Bankruptcy Court to sell off its holdings in Grayscale’s Bitcoin Trust (GBTC), Ethereum Trust (ETHE), and Ethereum Classic Trust (ETCG). The total value of these assets is approximately $1.6 billion. The purpose of this strategic liquidation is to maximize creditor repayments in light of potential market volatility following a recent settlement with the SEC.
Assets Targeted for Liquidation
The assets that Genesis Global Capital intends to liquidate include $1.4 billion worth of GBTC shares, $165 million worth of ETHE shares, and $38 million worth of ETCG shares. The urgency of gaining approval for the sale is emphasized by Genesis to mitigate the risks associated with price volatility and ensure timely distributions to creditors.
Additional Shares Pending Resolution
In addition to selling the trust assets, Genesis is also seeking legal ownership of 31,180,804 shares valued at around $1.2 billion that were pledged to Gemini but never transferred. This matter is currently awaiting resolution in court and was initially pledged as collateral for the Gemini Earn program by Genesis.
Settlement with SEC
Genesis reached an agreement with the U.S. Securities and Exchange Commission (SEC) to settle a lawsuit related to the operation of the Gemini Earn program. As part of the settlement, Genesis agreed to pay a $21 million fine from remaining funds after the bankruptcy process concludes. This settlement allows Genesis to focus on maximizing returns for its creditors without being burdened by prolonged litigation.
Motion for Asset Liquidation
A hearing for Genesis’ motion for asset liquidation is scheduled for February 8, indicating the company’s desire to expedite the process amidst ongoing challenges. This strategic liquidation effort is a significant step in Genesis’ bankruptcy proceedings and its commitment to resolving financial obligations, especially considering the recent conversion of GBTC to a spot Bitcoin ETF, allowing for the redemption of shares in cash.
Hot Take: Genesis Global Capital Seeks to Optimize Creditor Repayments Through Asset Liquidation
Genesis Global Capital has filed a petition with the U.S. Bankruptcy Court to sell its holdings in Grayscale Trusts, valued at approximately $1.6 billion. By seeking permission for this strategic liquidation, Genesis aims to maximize creditor repayments amidst potential market volatility. This move comes after reaching a settlement with the SEC and highlights Genesis’ commitment to resolving its financial obligations efficiently.
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