Digital Currency Group (DCG), a venture capital firm, has successfully made a $700 million payment to its subsidiary, Genesis Global Capital (GGC). This payment settles short-term loans from the now-insolvent crypto lending platform. The settlement comes four months after Genesis initiated a lawsuit against DCG and an affiliate over the repayment of overdue loans.
DCG announced on January 5 that it has cleared over $1 billion in debt in the past year, including the full loan repayment of $700 million to Genesis. The company’s CEO, Barry Silbert, expressed relief at this accomplishment, given the significant challenges the firm faced. Silbert shared on social media that DCG has repaid over $1 billion of debt, including the $700 million to Genesis, despite industry headwinds. He also expressed excitement about the industry’s next chapter and DCG’s leadership role in it.
The loan repayment to Genesis is particularly noteworthy due to the relationship between the two companies, a previous lawsuit, and GGC’s bankruptcy status. In September 2023, Genesis took DCG to court over non-payment of four loans valued at $500 million. Genesis also launched a separate lawsuit to recover 4,550 Bitcoin, worth $117 million, from DCG-affiliated company Digital Currency Group International Investments (DCIG).
After negotiations, DCG agreed in November to a repayment structure with Genesis, paying an immediate amount of $200 million. The company also committed to clearing all outstanding loans by April 2024, a promise it has now fulfilled.
In related news, DCG will retain its current ownership stake in Genesis until the crypto lender’s bankruptcy process is finalized. A court order stipulates that DCG maintaining its ownership shares in Genesis at 80% or above will allow the company to stay within DCG’s tax-consolidated group. This arrangement safeguards Genesis against potential federal net operating loss carryforward (NOLs) of $700 million, a crucial aspect of Genesis’s financial position as it navigates its bankruptcy proceedings.
Genesis filed for Chapter 11 bankruptcy in January 2023 following losses from the collapses of the FTX exchange and Three Arrows Capital. The company owes over $3.5 billion to numerous creditors, most notably the Gemini exchange. As of now, BTC is trading at $44,062 on the daily chart.
This News Article was automatically generated by Bob the Bot (AI)
| Information | Details |
|---|---|
| Geography | Global |
| Countries | |
| Sentiment | neutral |
| Relevance Score | 1 |
| People | Barry Silbert |
| Companies | Digital Currency Group International Investments, Digital Currency Group, Genesis Global Capital, FTX exchange, Three Arrows Capital, Gemini exchange |
| Currencies | Bitcoin |
| Securities | None |
