Genesis Global and its affiliated entities have initiated the disbursement of $4 billion in creditor payouts following the completion of their restructuring process.

According to an August 2 statement, the crypto lender Genesis Global began repayments to over 100,000 creditors after declaring bankruptcy in January 2023. The recovery rates vary by asset type, with Genesis creditors receiving an average of 64% of pre-bankruptcy value. Specifically, Bitcoin creditors are seeing a 51.28% recovery, Ethereum creditors 65.87%, and Solana assets 29.58%.

Stablecoin and U.S. dollar creditors fare the best, recovering 100% of their fiat-pegged tokens and cash. The repayments are divided between in-kind (the exact crypto asset deposited) and cash. This follows reports of Genesis moving $3 billion in cryptocurrencies.

“Creditors will be entitled to additional recoveries following the initial distribution, depending on the results of ongoing claims reconciliation, contractual rights against third parties, and litigation,” the Genesis press release stated.

Genesis initially collapsed in 2022 due to contagion in the crypto industry. The fallout from Terra’s implosion reverberated through digital asset markets, impacting various providers. The Terra saga crippled hedge fund Three Arrows Capital and crypto exchange FTX, ultimately forcing Genesis to halt withdrawals and declare bankruptcy.

The firm received financial aid from parent company Digital Currency Group, but DCG’s promissory note could not stabilize the beleaguered business. Legal disputes with crypto exchange Gemini added to the turbulent times.

New York Attorney General Letitia James also sued DCG and the crypto lender for misleading investors and falsifying financial statements. The matter settled for $2 billion between the crypto lender and NY authorities. Genesis said its restructuring plan includes a $70 million litigation fund “to pursue causes of action against various third parties, including Digital Currency Group” as protected court battles continued.

Stay updated with the latest developments in the cryptocurrency world on Global Crypto News.

Post Views: 4