Gemini Genesis is looking to recover its dues from parent DCG and is working on a forbearance plan with multiple creditors.
Gemini Trust Company LLC recently said that Genesis parent DCG defaulted on a $630 million loan payment last week. This development is the latest development in the ongoing dispute between cameron winklevoss– Run crypto custodian and digital currency VC firm.
In January, Gemini CEO Winklevoss threatened to sue their DCG counterparts Barry Silbert, and the entire company, debt repayment of more than $900 million. The Winklevoss’ threat came after one of DCG’s subsidiaries, Genesis, at the time, filed for Chapter 11 bankruptcy. The CEO of Gemini is trying to recover his company’s debts and users’ assets from the sinking VC firm.
Following DCG’s recent failure to make over $630 million in payments to Gemini, the Winklevoss-run crypto exchange has taken proactive steps. Gemini is working closely with DCG and some of its subsidiaries, including Genesis and CoinDesk, to provide DCG with tolerances. The reason for this action is to avoid default.
DCG also owes debt to digital asset financial facilitator Genesis and crypto-focused news site CoinDesk.
Gemini provides update for contingency plan including payment miss after origination and DCG
On its site, Gemini posted updated contingency plans it would execute if it is unable to reach an agreement with the DCG. Crypto Custodian and other parties propose a revised reorganization plan with Genesis. However, if this scenario were to happen, Gemini pointed out in the proposal that the DCG’s approval would not be required.
Produce wrote,
“In the event that a deal cannot be reached, Gemini is working with Genesis (along with other parties) to suggest terms for a revised scheme of reorganization that can be advanced without the consent of the DCG.” … This would be a plan in which Gemini would have input if not outright support.
The New York-based crypto exchange and custodian also wrote in its update:
“Consideration will be based in part on whether the parties believe that DCG will negotiate in good faith the agreed deal.”
Winklevoss previously accused DCG CEO of ‘bad faith stall tactics’
Amid the repayment dispute, the Winklevoss, co-founder of Gemini, accused DCG’s Silbert “Bad Faith Stall Tactics.” in one open letter Posted on Twitter on January 2, Winklevoss slammed the DCG CEO for ‘changing the lives’ of over 340,000 affected Earn users. The Gemini co-founder and CEO also pointed out that his company waited for six weeks for an update on the repayment agreement from the DCG to no avail. At the time, the Winklevoss regretted, “For the past 6 weeks, we have made every effort to engage with you in good faith.” He also said that the DCG returned the outstanding amount of $1.675 billion to further its own interests instead of repaying the creditors. Some of these alleged ‘self-serving’ actions include share buybacks and illiquid venture investments, which “balloon” DCG Trust’s fee-generating AUM.
Winklevoss ends his scathing attack on DCG by insisting that time is running out. He also said that the VC firm cannot absolve itself of its debt obligations, no matter how hard it tries.
Less than an hour after the Winklevoss posted his open letter, Silbert react, saying that DCG did not borrow $1.675 billion from Genesis. Furthermore, at the time, the embattled CEO said that his company was current with all its interest payments and outstanding loans. Finally, Silbert stressed that the DCG has yet to receive a response from the December 29 proposal sent to Genesis and Gemini advisors.
Meanwhile, late last week, Genesis lawyer filed a request Seeking an extension for the Chapter 11 plan in New York bankruptcy court.
Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to strip crypto stories down to the basics so that anyone anywhere can understand without a lot of background knowledge. When he is not delving deep into crypto stories, Tolu enjoys music, loves to sing and is an avid movie lover.
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