{"id":599545,"date":"2023-01-20T17:49:34","date_gmt":"2023-01-20T23:49:34","guid":{"rendered":"https:\/\/news.sellorbuyhomefast.com\/index.php\/2023\/01\/20\/crypto-lender-genesis-files-for-bankruptcy-following-sec-lawsuit\/"},"modified":"2023-01-20T17:49:34","modified_gmt":"2023-01-20T23:49:34","slug":"crypto-lender-genesis-files-for-bankruptcy-following-sec-lawsuit","status":"publish","type":"post","link":"https:\/\/newsycanuse.com\/index.php\/2023\/01\/20\/crypto-lender-genesis-files-for-bankruptcy-following-sec-lawsuit\/","title":{"rendered":"Crypto Lender Genesis Files for Bankruptcy Following SEC Lawsuit"},"content":{"rendered":"
\n<\/header>\n

\"Crypto\n<\/p>\n

Crypto lender Genesis, a subsidiary of Digital Currency Group (DCG), has filed for Chapter 11 bankruptcy. The filing followed a lawsuit brought by the U.S. Securities and Exchange Commission (SEC). Genesis claims to have \u201cample liquidity to support its ongoing business operations and facilitate the restructuring process.\u201d<\/strong><\/p>\n

Genesis\u2019 Bankruptcy Filing<\/h2>\n

Genesis Global Holdco LLC, a prime brokerage subsidiary of venture capital firm Digital Currency Group (DCG), announced Friday that it has voluntarily filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the Southern District of New York.<\/p>\n

The company\u2019s two lending business subsidiaries, Genesis Global Capital LLC and Genesis Asia Pacific Pte. Ltd., are part of the bankruptcy filing while \u201cother subsidiaries involved in the derivatives and spot trading and custody businesses and Genesis Global Trading are not included in the filing and continue client trading operations,\u201d the announcement clarifies.<\/p>\n

\u201cAs part of its Chapter 11 filing, Genesis has proposed a roadmap to an exit including a Chapter 11 plan,\u201d the company detailed, adding:<\/p>\n

\n

The plan contemplates a dual track process in pursuit of a sale, capital raise and\/or equitization transaction that would enable the business to emerge under new ownership.<\/p>\n<\/blockquote>\n

Derar Islim, Genesis\u2019 interim CEO, explained that prior to the bankruptcy filing, the company has been trying to \u201cremedy liquidity issues,\u201d including those caused by the default of crypto hedge fund Three Arrows Capital (3AC) and the collapse of crypto exchange FTX. Islim was appointed to his position last August.<\/p>\n

Genesis claims to have more than $150 million in cash on hand that \u201cwill provide ample liquidity to support its ongoing business operations and facilitate the restructuring process.\u201d The company has filed motions with the bankruptcy court \u201cto enable day-to-day operations to continue in the normal course.\u201d The announcement adds:<\/p>\n

\n

Redemptions and new loan originations in the lending business remain suspended, and claims will be addressed through the Chapter 11 process.<\/p>\n<\/blockquote>\n

Repaying Gemini Earn Investors<\/h2>\n

With a court-supervised restructuring process, Genesis explained that it plans to advance discussions with its creditors and parent company DCG in the hope of reaching \u201ca holistic solution for its lending business, which, if achieved, would provide an optimal outcome for Genesis clients and Gemini Earn users.\u201d<\/p>\n

Genesis and crypto exchange Gemini have been in a feud over Gemini\u2019s crypto lending program, Earn. Genesis froze withdrawals last November while holding approximately $900 million in investor assets from more than 340,000 Gemini Earn investors.<\/p>\n

Gemini co-founder Cameron Winklevoss stated on Twitter Friday that Genesis\u2019 bankruptcy filing \u201cis a crucial step\u201d towards Earn customers being able to recover their assets. However, he noted, \u201cCrucially, the decision to put Genesis into bankruptcy does not insulate Barry [Silbert], DCG, and any other wrongdoers from accountability,\u201d elaborating:<\/p>\n

\n

We have been preparing to take direct legal action against Barry, DCG, and others who share responsibility for the fraud that has caused harm to the 340,000+ Earn users and others duped by Genesis and its accomplices.<\/p>\n<\/blockquote>\n

\u201cUnless Barry and DCG come to their senses and make a fair offer to creditors, we will be filing a lawsuit against Barry and DCG imminently. We also believe that \u2014 in addition to owing creditors all of their money back \u2014 Genesis, DCG, and Barry owe them an explanation. Bankruptcy court provides a much-needed forum for that to happen,\u201d the Gemini co-founder concluded.<\/p>\n

Last week, the U.S. Securities and Exchange Commission (SEC) charged<\/a> both Gemini and Genesis Global Capital \u201cfor the unregistered offer and sale of securities to retail investors through the Gemini Earn crypto asset lending program.\u201d<\/p>\n

\n
\nTags in this story
\n<\/h6>\n<\/div>\n

What do you think about Genesis filing for bankruptcy? Let us know in the comments section below.<\/strong><\/em><\/p>\n

\n

\n<\/p>\n

\n
\nKevin Helms <\/h6>\n

\nA student of Austrian Economics, Kevin found Bitcoin in 2011 and has been an evangelist ever since. His interests lie in Bitcoin security, open-source systems, network effects and the intersection between economics and cryptography.<\/p>\n<\/div>\n<\/div>\n

\n
\n


\n\"NYU <\/a><\/p>\n<\/div>\n

\n


\n <\/a><\/p>\n<\/div>\n<\/div>\n

Image Credits<\/b>: Shutterstock, Pixabay, Wiki Commons<\/em><\/p>\n

Disclaimer<\/strong>: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com<\/a> does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.<\/p>\n

Read More<\/a>
\n Kevin Helms<\/p>\n","protected":false},"excerpt":{"rendered":"

Crypto lender Genesis, a subsidiary of Digital Currency Group (DCG), has filed for Chapter 11 bankruptcy. The filing followed a lawsuit brought by the U.S. Securities and Exchange Commission (SEC). Genesis claims to have \u201cample liquidity to support its ongoing business operations and facilitate the restructuring process.\u201d Genesis\u2019 Bankruptcy Filing Genesis Global Holdco LLC, a<\/p>\n","protected":false},"author":1,"featured_media":599546,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[22791,39471],"tags":[],"class_list":{"0":"post-599545","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-crypto","8":"category-lender"},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts\/599545","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/comments?post=599545"}],"version-history":[{"count":0,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/posts\/599545\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/media\/599546"}],"wp:attachment":[{"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/media?parent=599545"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/categories?post=599545"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/newsycanuse.com\/index.php\/wp-json\/wp\/v2\/tags?post=599545"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}