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NEW YORK (Reuters) – A lawyer for bankrupt Genesis Global Capital said Monday that cryptocurrency lenders are confident they can resolve disputes with creditors this week.
Attorney Sean O’Neill is in Manhattan bankruptcy court to consider a “day one” motion for Genesis Global Capital, a cryptocurrency lending business owned by Barry Silbert’s venture capital firm Digital Currency Group. I spoke at a hearing held in
Two months after freezing customer withdrawals following the collapse of Sam Bankman-Fried’s FTX exchange, Genesis and its two lending divisions filed for bankruptcy protection from creditors on January 19.
The filing follows the bankruptcies of cryptocurrency lenders BlockFi, Celsius Network and Voyager Digital since July last year.
O’Neill said Genesis has “some confidence” that it will resolve its dispute with creditors by the end of the week after about two months of negotiations, but will seek mediators if necessary. .
“Sitting here now, I don’t think we need a mediator,” he said. “I am very optimistic.”
Brian Rosen, an attorney for a creditor with a $1.5 billion claim, said he was “very close” to a deal. “Time will tell,” he said.
Genesis has sold various assets at auction and has said it plans to go bankrupt by May 19.
The company listed more than $5 billion in assets and liabilities in its bankruptcy filing and said it owed at least $3.4 billion to more than 100,000 creditors. The parent company estimates he has nearly $1.7 billion in claims against DCG.
DCG and Genesys’ derivative and physical trading, custody and brokerage businesses are not part of the bankruptcy.
Issues with Genesis put Silbert at odds with identical twins Cameron and Tyler Winklevoss. They are former U.S. Olympic rowers who run the cryptocurrency exchange Gemini, which Genesis owes $765.9 million and is its biggest creditor.
On January 12, the US Securities and Exchange Commission charged Genesis and Gemini with illegally selling unregistered securities through the Gemini Earn loan product.
Winklevosses says Genesis needs to repay $900 million in assets it owes to investors of about 340,000 Earn.
Cameron Winklevoss also demanded Silbert’s removal as head of DCG, and threatened lawsuits against DCG if Genesis’ bankruptcy did not result in a “fair offer to creditors.”
Chris Marcus, an attorney for Gemini and other creditors, said in court that there was “some work to be done” to make sure everyone was on the same page, but he was “cautiously optimistic. ‘ and said that the dispute could be resolved without a mediator.
DCG’s portfolio also includes crypto asset manager Grayscale and news service CoinDesk.
Genesis’ borrowers include hedge fund Three Arrows Capital and FTX-owned trading firm Alameda Research, people familiar with the matter said last week.
Three Arrows and Alameda are also in bankruptcy proceedings.
Reporting by Dietrich Knout, New York; Editing by Deepa Babington
Our standards: Thomson Reuters Trust Principles.
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