According to Judge Lane, any available funds for distribution by Genesis are being exhausted by creditor claims, which take priority over DCG’s equity stake.
Genesis Global, the bankrupt cryptocurrency lender, secured a court approval to return about US$3 billion in cash and cryptocurrency to its creditors. This decision leaves its parent company, Digital Currency Group (DCG), with no recovery from the bankruptcy.
Judge Sean Lane approved Genesis’s Chapter 11 repayment plan on Friday, May 17. This ruling clears the path for Genesis to unfreeze and return customer assets that have been locked up since the company halted withdrawals in November 2022 following the demise of several prominent cryptocurrency firms.
However, in the ruling, Judge Lane overruled an objection raised by DCG, which argued that Genesis should pay its customers and creditors no more than the value of the crypto assets in January 2023, when Genesis filed for bankruptcy. Bitcoin (BTC) was trading around $24,000 at the time, compared to more than $66,700 on Friday, indicating a substantial increase of over $42,000.
