The US bankruptcy court granted regulatory approval for Genesis Global for a $3 billion repayment plan.
Genesis Global a key cryptocurrency firm which was known for its trading, lending, and asset management services, filed for bankruptcy in January 2023. Despite the huge success in the market, Genesis went bankrupt because of its financial exposure with now-bankrupt crypto firms Three Arrows Capital and crypto exchange FTX.
On 17 May 2024, Genesis firm secured court approval for a $3 billion payout, demonstrating its ongoing efforts to manage financial challenges and remain influential in the crypto market.
Genesis froze customers’ funds in Nov 2022 and now it can unlock those crypto assets & distribute them to the customers.
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The court Judge Lane dismissed Genesis Global’s parent company DCG’s objection that Genesis should compensate creditors based on the January 2023 value of crypto assets, when Bitcoin was about $24,000. Since Bitcoin’s price has risen to over $66,700 by May 17, creditors may receive higher payouts. Lane ruled that DCG lacked the legal standing to contest the Chapter 11 plan.
Now it will be interesting to see how the former Genesis customers & creditors will react to this plan.
A similar kind of plan was also followed by the bankrupt crypto exchange FTX but the majority of the FTX creditors showed full disappointment.
It is worth it to know that many crypto lending platforms, including Celsius, BlockFi, Voyager Digital, etc collapsed badly in 2022, following the bankruptcy of the FTX crypto exchange & downfall of the Terra (Luna) crypto empire.
In late 2023, many crypto experts noted that the latest bull run was not backed by a loan game, unlike the 2021 bull run, so there are huge chances that the current bull run may survive up to 2025.
Read also: Kraken planning to delist Tether (USDT) to comply with MiCA: Report
Genesis Global Wins Court Approval for $3 Billion Disbursement
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