Gemini Co-Founders and Silbert in Escalating Feud
The feud between Tyler and Cameron Winklevoss, co-founders of Gemini, and Barry Silbert of Genesis has intensified. This comes after Genesis froze withdrawals from its retail lending program, Earn. The Winklevoss twins have accused Silbert and Genesis of misleading investors, prompting investigations by the US Federal Bureau of Investigation and the Securities and Exchange Commission.
New Agreement to Renegotiate Loan Terms
An agreement is pending creditor approval to renegotiate the terms of a $630 million loan between Genesis and DCG. The proposed terms involve a partial cash repayment upon closure of the deal, with the remaining amount structured as a two-year note.
Collateral Benefits for Gemini Earn Creditors
Gemini Earn creditors are in a relatively better position compared to other creditors due to collateral that Genesis posted to Gemini during their business relationship. This collateral includes around 31 million shares of GBTC, which has appreciated significantly. It represents about 60% of the total owed to Earn clients, potentially allowing Gemini Earn creditors to receive up to 110% of their claim.
Gemini’s Commitment Questioned
Gemini is accused by DCG of not fulfilling its commitment. DCG argues that if Gemini were to contribute the promised $100 million or distribute even a small portion of the collateral, Gemini Earn users would receive full recovery. However, Gemini has not made any contributions thus far.
Potential Coverage by Genesis Assets
The remaining balance owed to Gemini Earn users could be covered by various assets held by Genesis, including cash, stablecoins, and longer-term notes from DCG payments.
Hot Take: Gemini Earn Creditors Await Creditor Vote
The ongoing feud between the Winklevoss twins and Barry Silbert has taken a new turn with Genesis freezing withdrawals from its retail lending program. However, an agreement is in the works to renegotiate the loan terms between Genesis and DCG. Gemini Earn creditors have the potential to benefit from collateral posted by Genesis, potentially receiving up to 110% of their claim. The dispute centers around Gemini’s alleged failure to fulfill its commitment, which could impact the recovery for Gemini Earn users. As the creditor vote approaches, the fate of these users remains uncertain.
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