Genesis Reaches Settlement With Parent Company DCG in $620M Lawsuit
The beleaguered crypto lender Genesis and its parent company, Digital Currency Group (DCG), have reached a settlement that could end the protracted lawsuit aimed at recovering $620 million in repayments from DCG.
DCG Commits to Settling $324.5M in Loans by April
According to a filing made on November 28 to a New York Bankruptcy Court, Genesis outlined the terms of the agreement, revealing that DCG has committed to settling its outstanding $324.5 million in loans by April of the coming year.
The settlement allows Genesis the option to pursue any unpaid amounts.
This proposed settlement emerges as a strategic move by Genesis to bring a conclusion to a lawsuit initiated against DCG back in September.
The legal action sought to compel DCG to repay loans that had become overdue, totaling around $620 million. While DCG has made partial payments since the initiation of the lawsuit, this comprehensive settlement is expected to offer Genesis immediate, substantial, and near-term benefits.
More importantly, it is anticipated to circumvent the potential risks, expenses, and diversion of resources associated with protracted litigation.
The Proposed Plan Will be Subject to a Vote
The repayment agreement is a crucial component of Genesis’ broader strategy to address its outstanding financial obligations to creditors. The proposed plan will be subject to a vote by these creditors before it is submitted to bankruptcy judge Sean Lean for a final decision.
Judge Lean will carefully consider the creditors’ votes in determining the viability and fairness of the proposed plan.
In a related legal move, Genesis recently filed a lawsuit against crypto exchange Gemini on November 22, seeking to recover nearly $670 million in transfers.
This comes amidst an already challenging legal landscape for Genesis and Gemini, as both entities face a lawsuit from the Securities and Exchange Commission (SEC), alleging the sale of unregistered securities.
Furthermore, the state of New York has filed a lawsuit against Genesis, Gemini, and DCG, accusing the trio of defrauding investors.
