$620 Million Litigation Against Parent Company DCG
Genesis sued DCG for outstanding loans worth approximately $620 million. This development comes just after Genesis announced its $1.4 billion debt repayment plan backed by its customers.
Genesis filed a lawsuit in New York bankruptcy court Wednesday, saying they will continue to discuss a potential settlement that could end the dispute.
Loan Agreements Between Them
A financial relationship between DCG and Genesis began with a “principal loan agreement” signed in 2019. According to Genesis, the company had loaned DCG over 18,000 Bitcoins in 2022, turning this debt into a fixed-term loan that was due on May 11, 2023. However, the debt remained unpaid.
DCG said it signed a “modified and reorganized prime loan agreement” with Genesis and documented a standstill agreement. DCG explains: “At this point, we will initiate the distribution of funds and continue on a path of significant recovery for Genesis creditors.”
DCG and Genesis’ Relation
Genesis took a major financial hit after the collapse of Three Arrows Capital and FTX last year and filed for bankruptcy protection in January. Following this process, DCG and Genesis entered a legal battle, in which Gemini Exchange blamed DCG and its CEO Barry Silbert.
Source: The Block