- Digital Currency Group and crypto exchange Gemini have reached an agreement over the $900 million trapped with Genesis
- Gemini Earn customers have had funds trapped on Genesis Global Capital since November
- Customers can expect up to 80% of their funds back
Digital Currency Group (DCG) and crypto exchange Gemini have reached an agreement over the $900 million in user funds trapped on the Genesis Global Capital (GGP) platform, which will see up to 80% recovered. Announced yesterday, the deal will see Gemini contribute up to $100 million in cash as part of the deal that would see Genesis sell its trading arm, Genesis Global Trading (GGT). Gemini co-founder Cameron Winklevoss hailed the move as a “critical step forward towards a substantial recovery of assets for all Genesis creditors.”
Gemini and DGC War of Words Ends
Gemini and DCG have been locked in a battle of words ever since GGP, the platform used by Gemini for its interest-earning Gemini Earn holders, shut down withdrawals, citing a lack of funds. This war of words escalated in January and turned into a public declaration of war, with Winklevoss threatening to take DCG CEO Barry Silbert to court if he didn’t help work towards a solution.
Finally, a month after these threats, a resolution has been put to the Genesis bankruptcy board that would represent the best possible outcome for Gemini Earn customers. Under the terms of the deal, which had been agreed between DCG, Gemini, and Genesis’ range of creditors, relates in the main to a refinancing of Genesis’ loans to DCG, which stands at over $500 million.
Genesis Will Sell Trading Arm
Genesis will exchange its existing $1.1 billion promissory note, which was the subject of fierce debate between Winklevoss and Silbert, into convertible preferred stock to be issued by DCG as part of Genesis’ bankruptcy plan. DCG will refinance other loans into two tranches made payable to creditors with a total value of around $500 million, and will also look to sell GGT once the deal has been concluded in order to claw back some of the case. Gemini will contribute to the plan to the tune of $100 million in cash to Earn customers.
Winklevoss outlined the plan to Gemini Earn users on Twitter, saying that it “provides a path for Earn users to recover their assets”, although potentially not all of them. Still, 80% in today’s crypto climate is a very good deal and no mistake.
