Genesis lenders call DCG agreement ‘wholly insufficient’
The lenders of the bankrupt cryptocurrency lender Genesis are not satisfied with the latest in-principle settlement agreement with other parties including the Digital Currency Group (DCG).
The Ad Hoc Group of Genesis Global Capital (GGC) lenders — represented by lawyers Brian Rosen and Jordan Sazant — on Aug. 29 responded to a public bankruptcy plan update, calling the reached in-principle agreement “wholly insufficient.”
Posted hours before, the public update said that DCG reached an agreement in principle with Genesis’ unsecured creditors (UCC) and debtors, proposing USD equivalent recoveries of 70%–90%. The update stressed that neither the Ad Hoc Group nor the Gemini exchange supported the deal in principle described in the plan update.
“Although the mediation has terminated, constructive discussions with the Ad Hoc Group and Gemini regarding the aforementioned agreed-upon deal in principle are ongoing,” the update noted.
In response, the Ad Hoc Group stressed that it indeed does not support the proposed agreement in principle, calling DCG’s contribution “wholly insufficient to satisfy” the loan amounts. The lenders argued that the debtors and UCC are “unwilling to comply with their fiduciary obligations” to maximize creditor recoveries, arguing that they are instead trying to put the base behind them. The filing added:
The Genesis lenders also argued that DCG should not be entitled to non-consensual third party releases, which release non-debtor parties from liability to other non-debtor parties without the consent of all potential claimholders.
Related: Gemini files brief in lawsuit against SEC, requests to keep it simple
The Ad Hoc Group argued that the debtors and UCC have agreed to “improperly cause the release
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