It has been just reported that the crypto leader Genesis has just filed a lawsuit against Gemini. Check out all the juicy details about what happened here.
Genesis files lawsuit against Gemini
Genesis, a crypto lending firm, is currently involved in a lawsuit with cryptocurrency exchange Gemini.
The objective of the lawsuit is to recover over $500 million in preferential transfers. Preferential transfers are payments made by an insolvent company to a creditor within 90 days before filing for bankruptcy.
If certain conditions are met, the recipient may be legally obligated to return the funds to ensure that payments to the bankrupt company’s creditors are distributed fairly.
This is a complex legal issue, and we hope that all parties involved will work together constructively to find a fair and mutually beneficial solution.
According to a recent court filing, Genesis has filed a claim to recover more than $689 million in withdrawals made through the Gemini Earn Program in the 90 days leading up to its declaration of Chapter 11 bankruptcy.
Previously, the two firms had collaborated on the Earn investment program, which allowed retail investors to loan their cryptocurrencies and earn interest. However, Genesis defaulted on its obligations.
The company states that it is seeking to recover these funds, which it believes were withdrawn to benefit Gemini at the expense of other creditors.
“During the ninety (90) day period prior to the commencement of Plaintiff’s Chapter 11 Case, Defendants withdrew an aggregate gross amount of no less than approximately $689,302,000 from Plaintiff. As a result of these withdrawals, Defendants benefitted at the expense of Plaintiff’s other creditors, and continue to benefit to this day through their retention of the property Plaintiff seeks to avoid and recover here.”
As the online publication the Daily Hodl notes, Genesis is demanding the return of the funds as it faces a lawsuit from Gemini for failing to return the shares in a Bitcoin (BTC) trust that were pledged as collateral for the Earn loans.
