Crypto exchange Gemini has raised objections against the bankruptcy resolution proposal put forth by Genesis. The exchange, alongside two other creditor groups, argue that the presented proposal fails to provide critical specifics and adequate assurances to major debtors. This stems from a disputed ‘agreement in principle’ reached previously with DCG.
Gemini is heavily involved in the situation as it had previously taken legal action against DCG for fraud, following the digital conglomerate’s non-payment of debts owed to the Winklevoss-owned crypto platform. Principally, Gemini’s contestation pertains to the clarity and economic consideration of the proposed resolution, with its legal representatives stating the agreement’s deficiencies lie in its lack of sufficient details.
Moreover, Gemini’s objection underscores the unaddressed issue of DCG’s outstanding loans, valued approximately at $630 million, which were reportedly due for repayment in May 2023. This objection mirrors concerns raised by another creditor group, known as the Fair Deal Group. They too claim the proposal fails to provide comprehensive security of Genesis’ debts and raises questions on the project’s long term viability.
In response, Genesis’ bankruptcy proceedings have met with numerous challenges. The Ad Hoc Group of Genesis Lenders has voiced its doubts, particularly about DCG’s role in the proposed resolution, deeming it inadequate to meet creditor claims. Both the Fair Deal Group and Gemini have urged for an end to the exclusive negotiation period that permitted Genesis to dictate its bankruptcy terms, citing the debtor’s requests for extensions and the looming promise of a resolution involving DCG.
This drama comes in the wake of the financial turbulence that began with FTX’s bankruptcy in November 2021, which placed significant stress on multiple other companies in the industry. However, it seems, as Genesis continues to struggle with its financial troubles amplified by the 2022 crypto downturn, these creditor groups are demanding transparency, comprehensiveness, and satisfaction in the resolution of this complex bankruptcy affair. The objections put forth by Gemini and other creditor groups lay bare the intricacies of these proceedings and highlight urgent calls for effective solutions to navigate the challenges posed by such incidents in the industry.
Source: Cryptonews
