Gemini is suing Genesis for using $1.6 billion worth of GBTC shares as Earn collateral.
In a legal showdown that unfolded within the courtrooms of the Southern District of New York Bankruptcy Court on October 27, cryptocurrency exchange Gemini launched an adversary proceeding against the bankrupt crypto lender, Genesis Global Holdco. The battle revolves around the destiny of a substantial 62,086,586 shares of Grayscale Bitcoin Trust (GBTC), which were initially deployed as collateral to secure loans granted to Genesis through the Gemini Earn Program, supported by a staggering 232,000 Gemini users. As of the present day, the assessed worth of this collateral stands close to a staggering $1.6 billion. The lawsuit contends that Gemini successfully acquired $284.3 million by executing a foreclosure on this collateral, with the intention of distributing these funds for the benefit of the Earn users. However, Genesis has vehemently opposed these actions, effectively impeding Gemini from dispersing the accumulated proceeds. Genesis, in its defense, has proposed an alternative ...