Genesis Global, a subsidiary of Digital Currency Group (DCG), filed for Chapter 11 bankruptcy protection in the Southern District of New York bankruptcy court on Jan. 19, a press release said.
Genesis’ derivatives, physical trading, broker-dealer and custody divisions are not subject to bankruptcy filings and are operating normally, the company said.
restructuring
Under Chapter 11, the company is considering a restructuring, which will be led by an independent special committee of its board of directors, it said.
According to the company, its assets and liabilities are between $1 billion and $10 billion. Press releaseGenesis said it has more than $150 million in cash, providing “sufficient liquidity” to support its operations and the restructuring process.
The court-supervised restructuring “will provide optimal results for Genesis customers and Gemini Earn users,” the company said. Genesis owes him $900 million to Gemini Earn users.
Cryptocurrency lenders are exploring a “dual-track process” to pursue “sales, capital raises, and/or equity transactions that allow businesses to emerge under new ownership.”
Genesis will either initiate the marketing and sale process of the assets or raise capital and use the proceeds to repay creditors. However, according to the press release, creditors would receive ownership of the reorganized Genesis Global if the company fails to complete the sale or raise capital.
The company has been trying to raise money for months without success. Its parent company, DCG, was reportedly considering liquidating his venture capital holdings to cover his $3 billion debt burden for Genesis.
Genesis froze customer withdrawals in November shortly after the FTX demise. Earlier this month, the company cut its workforce by 30% of his.
