Judge Approves Genesis Global’s $3 Billion Customer Repayment Plan
Bankrupt crypto lender Genesis Global has been approved by a bankruptcy court to return approximately $3 billion in cash and cryptocurrency to its customers.
Significantly, the ruling leaves Genesis’ parent company, Digital Currency Group (DCG), without any recovery from the bankruptcy.
DCG Sidelined in Genesis Chapter 11 Plan
In a May 17 court filing, bankruptcy Judge Sean Lane approved the Chapter 11 liquidation plan for the failed crypto lender Genesis Global. Judge Lane stated that the plan’s Distribution Principles represent a compromise. US dollar creditors will receive near-term distributions funded partly by monetizing certain digital assets, and digital asset creditors will receive “in-kind” distributions to the maximum extent possible.
Additionally, Judge Lane ruled that DCG lacked the legal standing to challenge the Chapter 11 plan. The judge ruled that DCG was last in line for repayment because it is an equity holder. Besides that, the Court pointed out that Genesis’ value is being distributed to its creditors, who would not be fully repaid and have priority over DCG.
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