Genesis and DCG are expected to respond to the creditor committee by the end of the week.
A creditor committee, which includes Gemini, has presented a plan to Genesis and Digital Currency Group to “provide a path for the recovery of assets,” according to Gemini co-founder Cameron Winklevoss in a tweet.
At the peak of the bull market in February 2021, Gemini partnered with Genesis to launch Gemini Earn, which offered clients up to 7.4% interest on their crypto deposits. Due to the FTX-induced market turmoil, Genesis suspended withdrawals in mid-November, effectively freezing Gemini Earn funds.
“This decision was made in response to the extreme market dislocation and loss of industry confidence caused by the FTX implosion,” said Amanda Cowie, DCG’s vice president of communications and marketing at the time. “This decision impacts the lending business at Genesis and does not affect Genesis’s trading or custody businesses. Importantly, this decision has no bearing on DCG’s or our other wholly owned subsidiaries’ business operations.”
CoinDesk’s parent company is Digital Currency Group (DCG).
Previous reports put the total amount owed to Gemini at $900 million, out of a total of $1.8 billion owed to the creditors’ group.
The Creditor Committee has retained investment bank Houlihan Lokey as a financial adviser, with law firm Proskauer Rose acting as counsel.