However, the $284.3 million may be all that is due. This could further delay the bankruptcy case, meaning Gemini Earn customers may be set for a long wait before recovering their funds. However, Gemini will likely challenge the claim, resulting in court action. The dispute requires the judge overseeing the bankruptcy to make a call on whether the agreement stands. Given the “behind-the-scenes” agreement between the two parties, Genesis now claims the $769 million balance owed to Gemini Earn customers has been paid with the GBTC share sale. However, with a balance owed of $769 million, the shortfall amounts to $484.7 million. 16, 2022, Genesis froze withdrawals from its platform and informed Gemini that it had sold the collateralized GBTC shares at $9.20 per share, netting $284.3 million. 11, 2022, following weeks of insolvency rumors beforehand. Incidentally, FTX filed for bankruptcy on Nov. This arrangement was later extended on Nov.
15, 2022, Genesis pledged 30.9 million GBTC shares as collateral for Gemini Earn’s customers’ tokens. In an unexpected development, Genesis now claims it has fulfilled its obligations to Gemini by paying out the proceeds of a private sale of Grayscale Bitcoin Trust (GBTC) shares that collateralized the debt.
The bankruptcy filing showed that Genesis owed its creditors $3.5 billion the largest is Gemini, with a $769 million balance due. 19, triggering panic among its creditors. Customers’ tokens were then loaned to counterparties, in this case, Genesis, who generate yield by trading and investing.Īfter months of insolvency rumors, Genesis filed for Chapter 11 bankruptcy on Jan. Gemini Earn paid rewards to customers who lent cryptocurrency to the program. Gemini Earn customers face a potential $485 million shortfall in their bid to be made whole following the Genesis bankruptcy.
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