Markets News Report
February 06, 2024

Digital Currency Group (DCG) Opposes Genesis’ Bankruptcy Plan Over Asset Valuation Dispute

In Brief

DCG opposed Genesis’ bankruptcy plan claiming that it overpays, by factoring the rising values of assets like Bitcoin and Ethereum.

Digital Currency Group Opposes Genesis' Bankruptcy Plan Over Asset Valuation Dispute

Digital Currency Group (DCG) has lodged a formal objection against the bankruptcy plan proposed by its subsidiary, Genesis Global Capital, citing a contentious disagreement over asset valuation. In a late Monday statement, DCG contended that Genesis‘s plan to allocate additional payouts to its customers exceeds its lawful entitlement.

At the heart of the dispute lies the valuation of crypto assets, with DCG insisting on pegging repayments to the value of these assets as of January 2023, the time of Genesis’s bankruptcy filing. However, as per Reuters, Genesis has advocated for accounting adjustments to reflect the appreciating prices of assets such as Bitcoin and Ethereum since January 2023, a stance DCG alleges contravenes U.S. bankruptcy laws.

Genesis Global Capital, in response, has embarked on liquidating its assets after failing to reach amicable settlements with DCG, its former business partner Gemini, and regulatory bodies.

The Securities and Exchange Commission (SEC) had initiated legal action against Genesis before its bankruptcy filing, alleging illicit securities sales through the jointly managed crypto lending program Gemini Earn.

Genesis Bankruptcy Plan Receives Support from Gemini

Support for Genesis’s bankruptcy plan has emerged from Gemini, the renowned cryptocurrency exchange helmed by the Winklevoss twins. Gemini asserts that the proposed plan offers a viable pathway to reimburse customers who have endured asset lockups exceeding 16 months.

This clash over asset valuation in bankruptcy proceedings echoes a recent legal precedent set in the Chapter 11 case of FTX. U.S. Bankruptcy Judge John Dorsey ruled in favor of valuing customer claims using cryptocurrency prices from November 2022, despite customer objections, affirming the clear parameters outlined in U.S. bankruptcy law.

The unfolding saga between DCG and Genesis Global Capital underscores the intricate legal and financial intricacies surrounding cryptocurrency-related bankruptcies. With regulatory scrutiny intensifying in this evolving landscape, the outcome of this dispute will undoubtedly have far-reaching implications for stakeholders within the crypto ecosystem.

Disclaimer

In line with the Trust Project guidelines, please note that the information provided on this page is not intended to be and should not be interpreted as legal, tax, investment, financial, or any other form of advice. It is important to only invest what you can afford to lose and to seek independent financial advice if you have any doubts. For further information, we suggest referring to the terms and conditions as well as the help and support pages provided by the issuer or advertiser. MetaversePost is committed to accurate, unbiased reporting, but market conditions are subject to change without notice.

About The Author

Kumar is an experienced Tech Journalist with a specialization in the dynamic intersections of AI/ML, marketing technology, and emerging fields such as crypto, blockchain, and NFTs. With over 3 years of experience in the industry, Kumar has established a proven track record in crafting compelling narratives, conducting insightful interviews, and delivering comprehensive insights. Kumar's expertise lies in producing high-impact content, including articles, reports, and research publications for prominent industry platforms. With a unique skill set that combines technical knowledge and storytelling, Kumar excels at communicating complex technological concepts to diverse audiences in a clear and engaging manner.

More articles
Kumar Gandharv
Kumar Gandharv

Kumar is an experienced Tech Journalist with a specialization in the dynamic intersections of AI/ML, marketing technology, and emerging fields such as crypto, blockchain, and NFTs. With over 3 years of experience in the industry, Kumar has established a proven track record in crafting compelling narratives, conducting insightful interviews, and delivering comprehensive insights. Kumar's expertise lies in producing high-impact content, including articles, reports, and research publications for prominent industry platforms. With a unique skill set that combines technical knowledge and storytelling, Kumar excels at communicating complex technological concepts to diverse audiences in a clear and engaging manner.

Hot Stories
Join Our Newsletter.
Latest News

The Calm Before The Solana Storm: What Charts, Whales, And On-Chain Signals Are Saying Now

Solana has demonstrated strong performance, driven by increasing adoption, institutional interest, and key partnerships, while facing potential ...

Know More

Crypto In April 2025: Key Trends, Shifts, And What Comes Next

In April 2025, the crypto space focused on strengthening core infrastructure, with Ethereum preparing for the Pectra ...

Know More
Read More
Read more
MAS Clarifies Regulatory Regime For Digital Token Service Providers, Addressing Industry Concerns
Business News Report Technology
MAS Clarifies Regulatory Regime For Digital Token Service Providers, Addressing Industry Concerns
June 6, 2025
Anthropic Unveils Claude Gov: Specialized AI Models Developed For US National Security Use
News Report Technology
Anthropic Unveils Claude Gov: Specialized AI Models Developed For US National Security Use
June 6, 2025
EigenLayer Rolls Out Redistribution Feature, Allowing AVSs To Repurpose And Distribute Slashed Funds
News Report Technology
EigenLayer Rolls Out Redistribution Feature, Allowing AVSs To Repurpose And Distribute Slashed Funds
June 6, 2025
First Week Of June:  Binance Academy And Solana Spark Global Blockchain Growth
News Report Technology
First Week Of June:  Binance Academy And Solana Spark Global Blockchain Growth
June 6, 2025