The mediation process between bankrupt cryptocurrency lender Genesis Global Holdco and its creditors is nearing its conclusion, set to end by August 16. However, the outcome of the negotiations remains uncertain as a deal is yet to be reached.
Time Pressure Mounts as Genesis’ Mediation Deadline Approaches
During a recent hearing before US Bankruptcy Judge Sean Lane, company lawyer Sean O’Neal expressed the urgency of the situation. O’Neal stated that if significant progress towards a deal is not made within the next two weeks, they would not seek an extension of the mediation period.
Efforts to Reach a Proposed Bankruptcy Exit Plan
Since May, Genesis has been actively engaging in discussions with key stakeholders, including parent company Digital Currency Group (DCG) and Gemini Trust, in an attempt to formulate a proposed bankruptcy exit plan supported by DCG.
A Struggle to Secure Consensus
Despite their efforts, Genesis’ official committee of unsecured creditors has rejected the proposed plan. Nonetheless, Genesis and other key stakeholders continue to advocate for its approval.
Backup Plan in Place
In the event that a consensus cannot be reached by August 16, O’Neal informed the court that the crypto lender will proceed with its existing bankruptcy plan, with certain amendments.
A Crucial Phase in Genesis’ Bankruptcy Resolution
The ongoing mediation represents a pivotal moment for Genesis as it aims to emerge from bankruptcy. The company and all parties involved understand the need to progress and find a resolution.
FTX and Genesis Reach Settlement Agreement Amid Bankruptcy Disputes
Recently, bankrupt crypto exchange FTX and defunct crypto lender Genesis have reached an agreement to settle their disputes within their respective bankruptcy cases.
The settlement agreement was disclosed in a letter submitted by their legal representatives to the US bankruptcy court for the Southern District of New York. It states that the parties have reached an agreement in principle, subject to further documentation, which would resolve various claims asserted by the parties against each other in the Chapter 11 Cases.
Genesis as Largest Unsecured Creditor of FTX
Genesis emerged as the largest unsecured creditor of FTX following its bankruptcy. Court documents revealed that FTX owed Genesis a significant sum of $226 million.
Complex Claims Between FTX and Genesis
On the other hand, FTX claimed that Genesis Global owed it a substantial amount of $3.9 billion, later reduced to $2 billion.
Progress Made by Digital Currency Group
Digital Currency Group (DCG), the crypto conglomerate led by Barry Silbert, has been actively working to settle the claims of its bankrupt subsidiary, Genesis. DCG has engaged in extensive negotiations to resolve the claims in the Genesis Capital Chapter 11 cases.
These settlement efforts represent significant progress towards resolving the bankruptcy disputes between FTX and Genesis.
