Genesis Files Lawsuit Against DCG in $600M Debt Dispute

Genesis Files Lawsuit Against DCG in $600M Debt Dispute

As per Reuters, Genesis Global Capital is currently pursuing the recovery of $500 million, which Digital Currency Group (DCG) had borrowed through four separate loans, in addition to 4,550 Bitcoins, valued at approximately $117 million. Digital Currency Group International owed these assets as part of a fifth loan agreement.

These loans were initially granted under master loan agreements established in 2022 and 2019, and their maturity dates were extended to May 2023.

Genesis had recently put forth a proposed plan to repay these debts. Unfortunately, most of its principal creditors did not accept this plan. Consequently, Genesis has taken legal action against DCG.

The company firmly asserts that these loans remain outstanding and is determined to recover both the principal sums and the accrued interest. They emphasize the importance of these recoveries for their financial state during the bankruptcy.

Nevertheless, Genesis is willing to consider a “partial repayment” arrangement with DCG and states they will halt legal proceedings if a mutually acceptable settlement is reached. Court documents reveal that DCG owes more than $1.7 billion to Genesis and other creditors.

Previously, Genesis had proposed a restructuring deal that could offer unsecured creditors a recovery rate of nearly 90%. This, however, is contingent upon the support of key creditors, including Gemini, which the Winklevoss twins own.

Genesis filed for Chapter 11 bankruptcy protection in January 2023, following the suspension of withdrawals and substantial loans provided to hedge funds Three Arrows Capital and Alameda Research, both of which had filed for bankruptcy in 2022.

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