Cryptocurrency

DCG responds to Genesis bankruptcy; Bitcoin jumps 4% as contagion fears lessen

Digital Currency Group, the parent company of Genesis and Grayscale, statement On January 20th, he commented on the news that Genesis had filed for Chapter 11 bankruptcy.

After the statement was released, Bitcoin climbed above $21,000 to a year-to-date high of $21,912.

DCG’s fate is being evaluated as an important potential catalyst to further push down the current cryptocurrency bear market. However, DCG’s statement appears to have allayed concerns about an imminent Bitcoin crash as DCG may liquidate its assets.

DCG confirmed that there is a clear separation between DCG and Genesis.

“Genesys has its own independent management team, legal and financial advisors and has appointed a special committee of independent directors to be responsible for the restructuring of Genesis Capital.”

In addition, DCG decided to file for Chapter 11 on Genesys’ appointed independent directors, ensuring that no DCG employee was involved in the decision.

Additionally, DCG and its companies were assured that they would “continue business as usual.” These companies include Grayscale Investments, trustee of the Grayscale Bitcoin Trust, and Genesis’ spot and derivatives trading business. So far, only Genesis’ lending arm has filed for bankruptcy.

DCG has confirmed that it has disclosed $526 million in debt to Genesis Capital in May 2023 and $1.1 billion in promissory notes due in June 2032.

The statement included a Q&A section assuming that DCG was not obligated to underwrite the $1.1 billion promissory note owed to Genesis. It is said that it was part DCG made him responsible for the loan to support Genesis, but never received the funds. 3AC he disintegrated in the May 2022 Luna crash, causing an industry-wide contagion.

$340 million was reportedly distributed across the Genesis group by the DCG as additional aid after the collapse of 3AC.

DCG also responded to the question, “What is DCG’s response to Gemini’s false accusations related to the Gemini Earn program and the threat of litigation?” Ignoring the obvious linguistic bias, DCG once again took the opportunity to describe the accusation as “another publicity stunt by Cameron Winklevoss to deflect blame away from himself and Gemini.”

The full statement can be read below or via dcgupdate.com Website:

Genesis DCG
DCG response to Genesis bankruptcy

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