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Updated February 4th, 2024 at 12:01 IST

Genesis initiates asset sale in US bankruptcy court

Gemini requests authority for the exchange to monetise the initial collateral of 30,905,782 shares of Grayscale Bitcoin Trust.

Anirudh Trivedi
Gemini
Gemini | Image:Gemini Exchange
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Cryptocurrency exchange Gemini Trust Co announced on Saturday that Genesis, a crypto lender, has filed a motion in the US Bankruptcy Court seeking authorisation for the sale of trust assets. The motion specifically targets the monetisation of interests in two Grayscale Ethereum trusts, which offer investors exposure to cryptocurrency securities.

According to Gemini, the motion, filed by Genesis on Friday, requests authority for the exchange to monetise the initial collateral of 30,905,782 shares of Grayscale Bitcoin Trust. Genesis has further requested an expedited hearing on this motion, scheduled for Feb. 8, as per a statement from Gemini.

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This development comes on the heels of Genesis settling a lawsuit with the U.S. Securities and Exchange Commission (SEC) related to its now-defunct Gemini Earn lending program earlier this week. In response to the Earn program's failure during the crypto market crash in November 2023, Genesis is implementing a liquidation plan. The plan aims to repay customers in either cash or cryptocurrency, depending on the currency types deposited in the Earn program.

The fallout from the Earn program's discontinuation has led to ongoing litigation involving Genesis, Gemini, and Genesis's parent company, Digital Currency Group. The situation underscores the complexities and challenges within the cryptocurrency industry, particularly when financial products intersect with market volatility.

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(With Reuters inputs)

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Published February 4th, 2024 at 12:01 IST

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