In a recent conference, crypto exchange Gemini announced a contribution of $100 million to its yield program Earn, helping users to recover their funds lost due to Genesis’ bankruptcy filing.
Following the catastrophic collapse of crypto exchange giant FTX, the crypto market has witnessed another victim of FTX’s bankruptcy: Genesis Global Capital, LLC (Genesis). However, investors may get relief soon as the long-standing feud between crypto tycoons Cameron and Tyler Winklevoss and Digital Currency Group’s Barry Silbert has finally come to an end, marking a significant turning point in the resolution of one of the most massive bankruptcies in the cryptocurrency industry. It is reported that Gemini is stepping up to the plate and committing to a massive $100 million cash infusion solely dedicated to its customers. This commitment is part of a landmark agreement with the bankrupt Genesis Global Capital and its parent company Digital Currency Group. According to a recent court hearing, this agreement is poised to bring positive change and stability for all parties involved.
Gemini Earn Users To Recover Their Funds Soon
In a recent court hearing, a new agreement has been reached between Gemini, Genesis Global Capital, and Digital Currency Group, bringing users one step closer to recovering their hard-earned money. The restructuring deal and recovery plan were announced during a conference for crypto lender Genesis, which filed for bankruptcy in New York on Jan. 19. Genesis owed its creditors billions of dollars, including Gemini and its users.
Last year was a wild ride for the cryptocurrency community as Gemini, and its lending partner Genesis experienced a major shutdown. The popular and lucrative Gemini Earn program, which offered an impressive 7.4% interest rate on crypto deposits, was forced to come to a halt, leaving over 340,000 investors in a state of uncertainty and putting a whopping $900 million in jeopardy. To make matters worse, Gemini suspended withdrawals in November due to the fallout from FTX’s collapse.
Gemini Becomes A Messiah Amid Bankruptcy
Digital Currency Group (DCG) and creditors, representing a massive $2 billion claim against the bankrupt Genesis lending division, including Gemini, have finally reached a historic agreement. This plan involves DCG restructuring a whopping $1.7 billion debt and other obligations owed to Genesis. In addition, DCG will also be contributing equity interest in another unit, Genesis Global Trading, to the bankrupt lending arm.
Moreover, Gemini announced that it would contribute up to a massive $100 million as part of its partnership with Genesis on the high-yield product, Earn. In addition, Gemini will also be distributing the value of specific collateral previously received from Genesis to Earn customers.
Gemini, founded by the famous Winklevoss twins, Cameron and Tyler, engaged in a highly publicized showdown with Barry Silbert, the owner of Digital Currency Group (DCG). The Winklevoss brothers have publicly called out Silbert for mismanaging Genesis and its impact on one of Gemini’s own products, Earn, which promised returns of up to 8% on customer deposits.
However, DCG and Gemini are now working together to recover funds. A DCG spokesperson said, “It “actively engaged with Genesis and its creditors to reach a fair and equitable resolution. We are pleased to help Genesis reach this agreement with all the creditors that opted to participate in the process.”
In a press release, Derar Islim, Genesis’ Interim CEO, said, “I am grateful to the talented team at Genesis for their ongoing dedication and commitment to client service, and excited about working together to build Genesis for the future. I also want to express my deep appreciation to all of our clients for their continued patience and loyalty as we work through a resolution for our lending business.”
The crypto world was rocked with shock as the details of Genesis’s Chapter 11 filing were revealed, showcasing a staggering amount of debt owed to its top 50 creditors – over $3 billion. With seven creditors owed a minimum of $100 million and the largest claim being a jaw-dropping $766 million related to Gemini Earn customers, the future looked uncertain. However, Winklevoss assured users that the framework is projected to move forward and help them recover their funds as soon as possible.