Cryptocurrency financier Genesis to return $4 billion to customers after completing bankruptcy proceedings, Money News

On January 9, 2020, Mr. A arrived at the United States Bankruptcy Court for the Southern District of New York in Manhattan, New York, USA.

NEW YORK – Cryptocurrency financier Genesis Global on Friday (May 17) received court approval to return about $3 billion (S$4 billion) in cash and cryptocurrencies to customers in a bankruptcy liquidation. This left the owner, Digital Currency Group, unable to obtain compensation. bankruptcy.

U.S. Bankruptcy Court Judge Sean Lane has approved Genesis’ Chapter 11 liquidation plan, stating that Genesis must pay customers and creditors more than the valuation of its crypto assets in January 2023, when Genesis filed for bankruptcy. The DCG’s appeal, which argued that there was no such thing, was dismissed. .

Cryptocurrency prices have risen sharply since Genesis filed for bankruptcy, and DCG and Genesis disagree over who should benefit from the price increases. For example, Bitcoin’s current price is $67,000, but it was worth $21,084 in January 2023.

Lane rejected DCG’s objections and said that even if customers’ bills were capped at a lower price, Genesys had to file a $32 billion claim with the federal and federal government before funding the company. It ruled that it would have to pay a number of other creditors, including state financial regulators. Shareholder DCG.

“DCG simply does not have sufficient assets to provide recovery in these cases,” Lane wrote.

Genesis is repaying customers in cryptocurrencies whenever possible, but it doesn’t have enough cryptocurrencies to repay everything it owes.

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Genesis lawyer Sean O’Neill said Friday that the company disagrees with DCG’s argument that customers could be paid “in full” based on the January 2023 drop in cryptocurrency prices.

“We do not agree with the idea that the amount claimed is limited to the value on the date of the petition,” O’Neill said.

Genesis estimated in February that it could pay customers up to 77% of their insurance claims, depending on future price changes.

DCG could not be reached for comment late Friday.