Home Crypto Market Movers Bankruptcy Court Approves Genesis to Sell $1.6 Billion in Crypto Funds Amid Market Surge

Bankruptcy Court Approves Genesis to Sell $1.6 Billion in Crypto Funds Amid Market Surge

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In a landmark decision, a bankruptcy court has granted Genesis, a beleaguered digital asset lending firm, the authority to liquidate $1.6 billion worth of shares in Grayscale’s Bitcoin and Ethereum trusts. This move is part of Genesis’ larger strategy to navigate bankruptcy proceedings and repay its creditors. The approval was received from United States Bankruptcy Judge Sean Lane during a recent court hearing in White Plains, New York.

Genesis, currently in the throes of financial turbulence, holds a substantial stake in Grayscale Bitcoin Trust (GBTC) amounting to $1.3 billion, with an additional $207 million invested in the Ethereum trust. The urgency to sell these assets stems from the firm’s plea to the court, citing the need to avoid monthly fees of $1.9 million on its trust agreements.

The decision comes amidst Genesis’ ongoing battle to secure approval for its comprehensive bankruptcy plan. Digital Currency Group (DCG), the parent company of Genesis, revealed that creditors have yet to endorse the restructuring proposal, which envisions the winding down of Genesis’ operations and repayment to creditors in either cash or cryptocurrency.

DCG cautioned that the sale of Grayscale shares could be premature if Genesis fails to garner approval for its broader bankruptcy plan. This uncertainty adds a layer of complexity to Genesis’ financial predicament, as it attempts to navigate a delicate balance between asset liquidation and creditor satisfaction.

In a noteworthy backdrop, the cryptocurrency market has witnessed Bitcoin surpassing the $52,000 mark for the first time in two years, while Ethereum is inching closer to the $2,800 threshold. Genesis appears to be strategically capitalizing on this market surge, aiming to maximize gains from the sale of its cryptocurrency holdings.

However, Genesis faces additional legal challenges in the form of a lawsuit with the cryptocurrency exchange Gemini, founded by the Winklevoss twins. The lawsuit revolves around the custody of the $1.3 billion GBTC shares, with Gemini asserting that Genesis lacks the rightful claim to these shares. Gemini contends that the shares were utilized as collateral for loans obtained through the Gemini Earn program.

Coinciding with these developments, the cryptocurrency market has witnessed notable price movements, with Bitcoin surpassing the $52,000 mark for the first time in two years. Ethereum, too, has seen a surge, nearing the $2,800 threshold as reported by CoinMarketCap at 10:22 p.m. ET on Wednesday.

Genesis appears poised to leverage the market’s upward momentum and capitalize on the gains generated by the recent price surges in Bitcoin and Ethereum.

Meanwhile, Genesis finds itself embroiled in a legal dispute with Gemini, a prominent cryptocurrency exchange founded by the Winklevoss twins. The dispute centers around the custody of the $1.3 billion GBTC shares, with Gemini contesting Genesis’ rights to the shares, claiming they were utilized as collateral for loans obtained through the Gemini Earn program.

As Genesis navigates these complex legal and financial challenges, the broader cryptocurrency community remains attentive to the implications of these developments on market dynamics and investor sentiment.

As the financial drama unfolds, the cryptocurrency community watches closely, as Genesis navigates a complex web of legal battles, restructuring efforts, and market dynamics. The outcome of these developments could have far-reaching implications for both Genesis and the broader cryptocurrency landscape.

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Steven Anderson

Steven is an explorer by heart – both in the physical and the digital realm. A traveler, Steven continues to visit new places throughout the year in the physical world, while in the digital realm has been instrumental in a number of Kickstarter projects. Technology attracts Steven and through his business acumen has gained financial profits as well as fame in his business niche. Send a tip to: 0x200294f120Cd883DE8f565a5D0C9a1EE4FB1b4E9

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