Genesis Acquires Over 32,000 BTC After Offloading GBTC Shares
07 Aprile 2024 - 9:47AM
NEWSBTC
Embattled crypto lender Genesis Global Capital has continued to
ramp up efforts to pay up creditors after filing for bankruptcy
protection in January 2023. As part of these efforts, Genesis has
now reportedly sold off the entirety of its Grayscale GBTC holdings
to acquire a substantial amount of Bitcoin in order to implement
its repayment strategy. Related Reading: Bitcoin Dips, But
Don’t Panic: ETFs See Three Days Of Bullish Inflow Genesis Converts
GBTC Shares To Bitcoin In Preparation For Debt Settlement According
to a Friday report by Bloomberg Law, Genesis finalized the sale of
its 36 million GBTC shares, as revealed by the company’s lawyers in
a court filing on April 2. Genesis had initially received legal
approval to liquidate its GBTC holdings on February 2 with each
unit share valued at $38.50. However, court documents showed that
the current price of GBTC as at the time of sale on April 2 was
$58.50 resulting in a total sale price of $2.1 billion.
Bloomberg’s report disclosed that the bankrupt crypto lender then
used these proceeds to purchase 32,041 Bitcoin at a market price of
$65,685, which will be distributed to creditors as part of its
repayment plan, especially those who were previously enrolled in
the Gemini Earn program. These recent transactions align with
Genesis’s bankruptcy plan which allows the conversion of GBTC
shares to either Bitcoin or direct cash for the settlement of its
existing debt. Currently, the crypto lender owes $3.5 billion to
creditors and will commence repayment following court
approval. However, Genesis faces fierce opposition from its
parent company, Digital Currency Group (DCG), over its proposed
repayment plan. In a petition filed in February, DCG argues that
its bankrupt subsidiary looks to settle creditors’ claims at
amounts higher than their respective entitlement. DCG
believes such a repayment strategy violates the Bankruptcy Code and
is “unfair” since it will only benefit senior creditors who will
largely gain from an appreciation in Genesis’s crypto assets value
while equity holders and company stakeholders are left in
unfavorable positions. Founded in 2013, Genesis is one of the
prominent crypto firms to file for bankruptcy. Its insolvency is
largely linked to the sudden collapse of the defunct crypto
exchange FTX. Related Reading: Bitcoin Whales Maintain Positive
Accumulation Behavior Ahead Of 2024 Halving: Report Bitcoin Price
Overview In other news, Bitcoin gained by 2.55% in the last day to
reach a price of $69,339. Such price gain would be encouraging to
investors especially following the token’s overall negative
performance in the past week. On higher timeframes, BTC largely
remains largely bullish as anticipation continues to build ahead of
the halving event on April 19. The fourth halving in
Bitcoin’s history is expected to reduce the mining reward from 6.25
BTC to 3.125 BTC. BTC trading at $69,314 on the daily chart |
Source: BTCUSDT chart on Tradingview.com Featured Image from
Nairametrics, chart from Tradingview.com
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