Genesis Global and its subsidiaries have begun making $4 billion in payments to creditors after completing the restructuring process.
According to a statement released on August 2, crypto lending company Genesis Global I started Paying off debts of more than 100,000 creditors after declaring bankruptcy in January 2023.
Recovery rates vary by asset type, with Genesis creditors receiving an average of 64% of pre-bankruptcy value. The lender disclosed a 51.28% recovery for Bitcoin (BTC) creditors, 65.87% for Ethereum (ETH) creditors, and 29.58% for Solana (SOL) assets.
Creditors holding stablecoins and US dollars fared better, getting 100% of their fiat- and cash-linked crypto back. The payments were split between in-kind (exactly the crypto assets deposited) and cash. This comes on the heels of reports that Genesis moved $3 billion in crypto.
“Creditors will be eligible for additional amounts after the initial distribution, depending on the outcome of ongoing claims settlements, contractual rights against third parties, and litigation,” Genesis said in a press release.
Genesis bankruptcy
Genesis initially collapsed in 2022 due to the spread of contagion in the crypto industry. The repercussions of Terra’s collapse have reverberated through the digital asset markets, affecting many service providers.
The Terra saga crippled hedge fund Three Arrows Capital and cryptocurrency exchange FTX, eventually forcing Genesis to halt withdrawals and declare bankruptcy.
The company received financial assistance from parent company Digital Currency Group, but the debt issued by DCG was unable to ease the beleaguered business and legal disputes with cryptocurrency exchange Gemini during turbulent times.
New York Attorney General Letitia James also sued DCG and the crypto lender for misleading investors and falsifying financial statements. The crypto lender and New York authorities settled for $2 billion. Genesis said its restructuring plan includes a $70 million litigation fund “to pursue causes of action against various third parties, including Digital Currency Group” as the court battles continue.
Comments are closed, but trackbacks and pingbacks are open.