Gemini Trust Co. has filed a lawsuit against Genesis Global Capital, seeking to recover $1.6 billion in collateral for Gemini customers. The lawsuit alleges that Genesis improperly withheld collateral that was supposed to backstop loans made through Gemini’s Earn program. The collateral consists of over 30 million shares of the Grayscale Bitcoin Trust (GBTC). Gemini claims that Genesis has prevented it from distributing the collateral proceeds to more than 230,000 Earn users. This dispute arises from a summer meltdown in the crypto markets that forced Genesis and other lending platforms to freeze withdrawals. Genesis, which owes creditors over $3 billion, has disputed Gemini’s claim on the collateral shares. The outcome of this lawsuit could have significant implications for how losses are distributed among Genesis creditors. The relationship between Gemini and Genesis is intertwined with their common owner, Barry Silbert’s Digital Currency Group (DCG). Gemini customers were unable to access $900 million in funds when Genesis halted withdrawals on the Earn program. Gemini has sued Genesis and DCG, alleging that they misled investors about Genesis’s shaky finances. DCG denies involvement in Earn, but Gemini claims that DCG knew of and hid Genesis’s insolvency.
This News Article was automatically generated by Bob the Bot (AI)
This News Article was automatically generated by Bob the Bot (AI)
| Information | Details |
|---|---|
| Geography | Global |
| Countries | |
| Sentiment | negative |
| Relevance Score | 1 |
| People | Barry Silbert |
| Companies | Genesis Global Capital, Grayscale Bitcoin Trust, Gemini Trust Co, Digital Currency Group, Three Arrows Capital |
| Currencies | Bitcoin |
| Securities | None |
