Benzinga - Digital Currency Group (DCG) is on the verge of settling claims related to the bankruptcy of Genesis, as revealed in a recent court document.
The proposed settlement might enable unsecured creditors to retrieve between 70% and 90% of their claims in USD, Coindesk reported.
Additionally, stakeholders could potentially recover between 65% to 90% on an in-kind basis, depending on the specific digital currency involved. These projected recoveries, however, are contingent on market conditions and finalized paperwork. Such complexities in the crypto recovery landscape will be dissected and discussed at Benzinga's Future of Digital Assets event, offering attendees invaluable insights into the volatile world of cryptocurrencies.
Genesis, which had to pause withdrawals last November following the downfall of FTX, sought bankruptcy protection at 2023's onset.
DCG had previously hinted at nearing a settlement in a shareholder communication last month.
DCG commented, "The agreement in principle will be documented and submitted to the Bankruptcy Court for final approval in connection with confirmation of a chapter 11 plan. We look forward to executing on this important milestone and for Genesis to begin its distributions to creditors."
To address DCG's outstanding debts, which include around $630 million from unsecured loans maturing in May 2023 and a $1.1 billion promissory note due in 2032, a partial repayment plan has been established.
Also Read: $3 Billion Crypto Manager Takes A New Stand On Bitcoin After Sudden Decline - And Gives A Trading Tip
This plan involves two payments: roughly $328.8 million to be paid in two years and $830 million over seven years. Furthermore, DCG has committed to four payments totaling $275 million following the partial repayment agreement, specifically for the May 2023 dues.
In January 2023, Genesis Global Holdco, LLC, along with its affiliate companies, declared bankruptcy in the U.S. Bankruptcy Court for the Southern District of New York.
Documents from the filing disclosed that Genesis owed a debt of over $3.5 billion to its major 50 creditors.
This list includes notable names such as crypto platform Gemini, trading powerhouse Cumberland, and financial entities like Mirana, MoonAlpha Finance, and VanEck’s New Finance Income Fund.
Read Next: House Republicans Demand Jerome Powell Provide Clarity On Fed's Crypto Intervention
Discover Fintech innovations and delve into the Future of Digital Assets at Benzinga's premier events; grab your tickets today to be part of the revolution!
Photo: Shutterstock
© 2023 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.