Crypto loan Genesis reports bankruptcy after the SEC lawsuit-presented Bitcoin messages
Crypto loan Genesis reports bankruptcy after the SEC lawsuit-presented Bitcoin messages
The crypto loan Genesis, a subsidiary of the Digital Currency Group (DCG), has applied for bankruptcy according to Chapter 11. The submission followed a lawsuit by the US Securities and Exchange Commission (SEC). Genesis claims to "have sufficient liquidity to support ongoing business operations and to facilitate the restructuring process".
bankruptcy request from Genesis
Genesis Global Holdco LLC, a Prime Brokerage subsidiary of the Risk capital Society Digital Currency Group (DCG), announced on Friday that she voluntarily applied for bankruptcy 11 from the US bankruptcy court for the southern district of New York.
The company's two subsidiaries in the lending business, Genesis Global Capital LLC and Genesis Asia Pacific Pte. Ltd., are part of the bankruptcy application, while "other subsidiaries who work in the derivative, cash down and custody account are not included in the application and continue the customer trade," says the announcement.
"As part of his submission according to Chapter 11, Genesis proposed a timetable for an exit, including a plan according to Chapter 11," explained the company and added:
The plan provides for a two -track process to pursue a sale, capital procurement and/or an equity transaction that would enable the company to emerge under a new owner.
DERAR Islim, Interims CEO of Genesis, said that the company tried to "fix liquidity problems" before the bankruptcy application, including those caused by the failure of the crypto hedge fund Arrows Arrows Capital (3AC) and the collapse of the crypto exchange. Islam was appointed to his position last August.
Genesis claims to have more than $ 150 million in cash that will "provide sufficient liquidity to support ongoing business operations and to facilitate the restructuring process". The company submitted applications to the bankruptcy court "in order to continue normal business operations". The announcement adds:
Definitely and new lending in the lending business are subject to and claims are processed as part of the Chapter 11 procedure.
repayment of Gemini Earn investors
With a court-supervised restructuring process, Genesis explained that it is planning to promote the talks with its creditors and the parent company DCG, in the hope of “achieving a holistic solution for his lending business, which, when it is achieved, would offer an optimal result for the customers of Genesis and Gemini Earn user.”
Genesis and the Gemini crypto exchange have argued about the crypto loan program from Gemini, Earn. Genesis frozen with withdrawals last November, while it gave around $ 900 million in investor assets of more than 340,000 Gemini Earn investors.
Cameron Winklevoss, co-founder of Gemini, said on Friday on Twitter that the bankruptcy application from Genesis was "a decisive step" to put EARN customers into a position to retain their assets. However, he noticed: "It is crucial that the decision to send genesis into bankruptcy not isolated [Silbert] DCG and all other culprits from the accountability obligation", and explains:
We have prepared to initiate direct legal steps against Barry, DCG and others who are jointly responsible for fraud, which has caused the over 340,000 Earn users and others who were led by Genesis and its accomplices.
"If Barry and DCG do not come to reason and make the creditors a fair offer, we will shortly submit a lawsuit against Barry and DCG. We also believe that Genesis, DCG and Barry - in addition to the creditors back their entire money - have an explanation. The bankruptcy court offers an urgently needed forum," Gemini co-founder.
Last week the US Securities and Exchange Commission (SEC) Gemini as well as Genesis Global Capital "for the unregistered offer and the sale of securities to small investors via the crypto assets program Gemini Earn".
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