DCG Fails to Make $630M Payment to Creditors Amid Genesis Negotiations, Says Gemini
In the midst of the financial dispute between crypto exchange Gemini and Digital Currency Group (DCG), Gemini has alleged that DCG failed to make a payment of around $630 million that was due last week. In response, Gemini has stated that it may extend “forbearance” to DCG in order to prevent a default.
DCG’s Alleged Missed Payment Adds Fuel to Gemini-DCG Dispute
On May 19, 2023, Gemini announced an update for the company’s Earn customers, which explains the “process of finding a resolution for all Earn users to redeem their assets.” When the collapse of FTX spread to Genesis Global Capital’s lending arm, it affected Gemini’s Earn program, and Gemini paused the program.
Following that issue, Gemini co-founder Cameron Winklevoss shared an open letter on Twitter in hopes of getting Digital Currency Group (DCG) CEO Barry Silbert’s attention. In the aftermath of the dispute, it has come to light that Genesis’ parent company, DCG, has allegedly failed to make a payment to its creditors.
“DCG, the parent company of Genesis Global Capital, LLC (Genesis) did not pay the approximately $630 million that came due last week. Genesis, the unsecured creditors’ committee (UCC), the ad hoc group of creditors (AHG), and Gemini are considering whether to provide a forbearance to DCG to avoid a DCG default,” Gemini wrote. The exchange’s update added:
Consideration will be based in part on whether the parties believe DCG will engage in good faith negotiations on a consensual deal.
In early 2023, Genesis Capital filed for bankruptcy, and negotiations for payment are now being conducted through the bankruptcy protection process. Gemini has made it clear that if a deal cannot be reached, the firm and the other parties involved are working with Genesis to propose terms for an amended reorganization plan that could be implemented without DCG’s consent.
In the update, Gemini revealed that Genesis filed a motion with the bankruptcy court on Friday to extend its exclusive period to propose a plan. “This would be a plan that would have Gemini’s input if not outright support,” the update on Friday noted.
What do you think the future holds for the ongoing conflict between Gemini and DCG? Share your thoughts in the comments section below.
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