Can Gemini’s Creditor Committee resolve the Genesis, DCG liquidity crisis

  • The Gemini creditor committee presented a plan to Genesis and DCG to resolve their liquidity issues 
  • Genesis and DCG owe $900 million to Gemini

Gemini, as of 21 December, provided an update to its users regarding the ongoing liquidity issues at fellow crypto exchange Genesis. Gemini’s co-founder Cameron Winklevoss posted a tweet informing his followers of an ad hoc committee.

Flying drone with camera

The ad hoc creditor committee, which includes Gemini, put forward a plan to resolve the liquidity issues at Genesis and its parent company Digital Currency Group (DCG). The committee aims to provide a path for the recovery of assets. 

Gemini Earn program with Genesis
The funds stuck in Gemini Earn accounts are at the center of this problem. Gemini Earn is a program that the New York-based exchange had launched in partnership with Genesis. Furthermore, the program was launched back in February 2021 amid a bullish crypto market. 

See also  Exclusive! Police have nabbed the culprit who sent me extortion mail, but my family is still worried for me: Bigg Boss 10’s Manu Punjabi

The Earn program offered users an interest rate of up to 7.4% on their crypto deposits. Following the market downturn due to the collapse of FTX in November, Genesis suspended withdrawals on its platform. As a result, the funds of the Earn program customers have been stuck since. 

Over the past few days, the situation at Genesis has gotten worse with rising fear and uncertainty regarding its liquidity. The finances of parent firm DCG have also come under scrutiny. 

$900 million owed to Gemini 
Los Angeles-based investment bank Houlihan Lokey has been roped in to represent the financial interests of the creditor committee. According to the update by the firm, the proposed plan is based on information received from Genesis, DCG and their advisors. “The Creditor Committee expects an initial response this week”, the update read. 

As the financial advisor to the creditor committee, Houlihan Lokey started exploring a plan to resolve said liquidity issues earlier this week. Furthermore, according to a report published by Financial Times earlier this month, Genesis and DCG owe as much as $900 million to Gemini. 

The exchange fell victim to a data breach last week. According to a blog post, the attack targeted a third-party vendor associated with the exchange. Additionally, the perpetrators were able to gain access to 5,701,649 lines of information pertaining to Gemini customers’ email addresses and partial phone numbers.

See also  Marvel’s Avengers Support Ending Soon, All Cosmetics Will Be Free

Source link

(This article is generated through the syndicated feed sources, Financetin doesn’t own any part of this article)

Thank you for reading this post, don't forget to subscribe!

We will be happy to hear your thoughts

Leave a reply

%d bloggers like this: