Varying Recovery Rates for Different Assets
On average Genesis debt holders can expect 64% of their pre-bankruptcy valuation but this is not the same for all types of assets, some of which are almost recovered. To elucidate, Bitcoin creditors will obtain 51.28%, Ethereum creditors 65.87%, and Solana creditors 29.58%. Creditors of Stablecoin and U.S. dollar are those who got their tokens and cash pegged to fiat currency completely recovered, i.e., 100%.
Breakdown of Repayments
Repayments contain virtual currencies and cash. This follows a piece of news that Genesis had shifted $3 billion in cryptocurrencies. Creditors may get more recoveries from claims that are not resolved, contract rights to another person, and litigation results.
Background of Genesis Bankruptcy
The crash of them in 2022 was a contagion because of the catastrophic failure of Terra in the crypto industry. This had an impact on several providers, such as hedge fund Three Arrows Capital and crypto exchange FTX, which caused Genesis to stop all withdrawals and seek for financial help with the Chapter 11 procedure.
Legal and Financial Challenges
Despite having gotten financial aid from Digital Currency Group (DCG), which were provided by their parent companies, Genesis was still battling legal issues. Letitia James who is the attorney general of New York, has filled in $2 billion settlements with (DCG) and them for the charges of misleading investors and false financial statements. The restructuring that Genesis would make would use $70 million lawsuit fund for claims against various third parties including DCG.
Future Outlook
As Genesis takes the final steps in the initial distributions, the central point continues to be the settlements of the ongoing claims and possible further recoveries. The firm hopes to get through the last legal problems by paying the owners of the money they are supposed to have.
