Genesis completes bankruptcy restructuring and plans to begin distributing $4 billion in crypto and cash with creditors receiving an average of 64% restitution

Genesis Global Capital, a major cryptocurrency lender and subsidiary of the Digital Currency Group, has completed its Chapter 11 restructuring and begun distributing approximately $4 billion in digital assets and cash to creditors, following confirmation of its bankruptcy plan by the U.S. Bankruptcy Court for the Southern District of New York on May 21, 2024. The restructuring became effective on August 2, 2024, marking Genesis’s emergence from bankruptcy after filing in January 2023 in the wake of market turmoil and the collapse of counterparties such as FTX and Three Arrows Capital. According to restructuring counsel Cleary Gottlieb, initial distributions include substantial in‑kind payments to creditors, with bitcoin creditors receiving 51% of their coin-for-coin claims (equating to around 166% of their petition-date dollar value), ether creditors receiving 66% (about 153% of petition-date value), and U.S. dollar creditors receiving 100% of their claim value. Unlike several other high‑profile crypto bankruptcies, Genesis did not seek to cap recoveries at the petition‑date fiat value of claims and instead structured a plan designed to provide coin‑for‑coin restitution where possible, supported in part by a settlement with the New York Attorney General. The firm has already distributed about $2.2 billion to Gemini Earn customers via Gemini Trust Company in a separate claims resolution process and is working with the plan administrator to execute roughly $200 million in additional distributions to altcoin creditors, with further payouts dependent on ongoing asset recoveries, claims reconciliation, and litigation outcomes. The case is viewed as a significant precedent for how large crypto lenders can resolve insolvency while passing through upside in crypto prices to creditors, and it reduces a major overhang for counterparties and users caught in the 2022–2023 lending‑market failures.

✨ AI-generated background, compiled from web sources — not editorial content.

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