- Crypto Lender Genesis Global’s bankruptcy reorganization completed, distributing $4 billion in assets to creditors.
- Creditor recoveries: Bitcoin 51.28%, Ethereum 65.87%, Solana 29.58%.
- Genesis’s bankruptcy affected Gemini users, leading to a $2 billion settlement and a $21 million SEC fine.
- Mt. Gox repayments started disbursing Bitcoin and Bitcoin Cash to creditors in July.
- Market stability efforts by Genesis and Mt. Gox to restore trust in the cryptocurrency market.
Genesis Global, one of the largest lenders of crypto assets, successfully completed the process of bankruptcy reorganization and began distributing almost $4 billion in digital assets and cash to creditors. The milestone marks a giant recovery phase for the company, which declared bankruptcy in early 2023 amid a challenging bear market that saw several crypto lenders collapse.
Accordingly, Bitcoin creditors will see 51.28% of their claims, valued in-kind, while Ethereum creditors enjoy a more significant recovery at 65.87%. Solana creditors will receive 29.58%.
That is how the distribution looks as part of efforts to stabilize and return assets to those affected by the Genesis financial turmoil. Genesis’s bankruptcy had far-reaching implications, notably impacting users of the Gemini exchange, which had a lending program through Genesis.
This collapse triggered a ripple of allegations and legal disputes between Genesis’s parent company, Digital Currency Group (DCG), and Gemini, including the allegations of fraud by the New York Attorney General which eventually resulted in a major $2 billion settlement.
Furthermore, Genesis reached a settlement with the US Securities and Exchange Commission earlier this year, agreeing to a fine of $21 million for holding an unregistered offer and sale of securities.
Restoring Trust in the Cryptocurrency Market
The timing of Genesis’s asset distribution closely follows another significant event in the cryptocurrency world. The defunct crypto exchange Mt. Gox has also started its repayment process to creditors, disbursing billions in Bitcoin and Bitcoin Cash.
The rehabilitation trustee for Mt. Gox confirmed that the payouts began in early July, with repayments scheduled on the 5th, 16th, 24th, and 31st. In a statement dated July 31, Mt. Gox outlined the progress of its repayment plan. The trustee reported that over 17,000 creditors had received their due Bitcoin and Bitcoin Cash.
The distribution process will proceed in line once the conditions are met. These include verification of the registered accounts and securing the transactions. The statement requested patience from eligible creditors as the process moves on.
Parallel events underscore the critical moment for the cryptocurrency industry, which is working on rebuilding people’s trust and stability in the market. These repayment initiatives by Genesis Global and Mt. Gox mean movement toward the resolution of disrupted financial events in the past through restitution to affected creditors.
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