Genesis bankruptcy case set for first hearing

Genesis Capital’s bankruptcy case will have its first hearing on January 23 at 2:00 p.m. (EST), according to court filings. Judge Sean H. Lane of the United States Bankruptcy Court for the Southern District of New York will hear the case.

Under Chapter 11, known as a reorganization chapter, companies can propose a reorganization plan to creditors while allowing their business to continue, according to law firm Buchanan Ingersoll & Rooney. Bankruptcy attorney Mark Pfeiffer told Cointelegraph.

As the first step in the bankruptcy proceedings, the court will decide whether to grant Chapter 11 relief requested by Genesis Global Holdco and its two creditor business subsidiaries, Genesis Global Capital and Genesis Asia Pacific. Acceptable or not, these are collectively called genesis capital. Joint management of cases was also requested by the companies.

A committee for unsecured creditors will also be appointed by the United States Trustee as part of the proceedings. The committee will have the right to require companies to consult and participate in the restructuring plan before making major decisions or changes. The twenty largest unsecured creditors are typically selected for committee, court filings. to reveal.

Related: The legal woes of Gemini and Genesis have further shaken up the industry.

Companies with liabilities up to $10 billion Filed for bankruptcy protection. On January 19, more than two months later Disclosure of $175 million exposure to FTX, with liquidity issues due to the collapse of crypto exchanges. There is a return. Suspended from Genesis Global Capital’s platform From November 16, 2022.

According to a press release, the Genesis Chapter 11 plan calls for a global settlement of all claims and the creation of a trust that will distribute assets among creditors. Under the “dual-track process,” the companies will pursue a “sale, capital increase, and/or equitization transaction” that would apparently enable its business to “emerge under new ownership.”

Genesis Capital’s parent company, Digital Currency Group (DCG), recently Denied involvement in bankruptcy filing.Claiming that a special committee of independent directors recommended and decided to file for Chapter 11 bankruptcy protection. Only Genesis’ credit institutions have filed for bankruptcy protection. Genesis Global Trading and Genesis’ spot and derivatives trading entities will remain operational.