Genesis Global Capital, a bankrupt crypto lender, is suing Gemini, a cryptocurrency exchange. They aim to recover around $689 million, according to court records from Nove 21.
In the suit, Genesis alleges that Gemini removed roughly $689,302,000 90 days before Genesis declared bankruptcy in Jan. This was done, Genesis claims, at the detriment of other owed parties.
Gemini continues to profit by holding onto the assets Genesis wants back. Genesis’s legal team is asking the court to use laws established in the U.S. Bankruptcy Code to fix this issue. They hope to put Gemini in the same boat as others Genesis owes money to.
The two big crypto companies are publicly arguing about getting back money. With lawsuits after the crypto exchange FTX fell apart in Nov 2022, things got more intense.
Blockchain Drama: Gemini vs. Genesis Legal Showdown Intensifies
On top of legal fixes, the heads of the two companies publicly argued. They blamed the other for not helping and warned about bringing their lawyers in.
Gemini started legal action against Genesis on Oct. 27. Gemini wanted to use 62,086,586 shares of its Grayscale Bitcoin Trust. It had used these shares to promise payment on loans from 232,000 Gemini users to Genesis through the Gemini Earn scheme. The promised payment is right now about $1.6 billion.
RephraseGenesis went bankrupt in January after halting withdrawals in November 2022. This caused issues for the Gemini Earn program. Consequently, they took legal action against Genesis’ parent company, Digital Currency Group (DCG), and its CEO, Barry Silbert. They claimed fraud in July.
By September, Genesis sued DCG, too. They wanted repayment for several loans totaling more than $600 million.
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